Ignoring climate risk is more costly than grappling with it (Huw van Steenis-FT)

Regulators and activists are driving global warming concerns into the mainstream

https://www.ft.com/content/dc2bdac0-316c-11ea-9703-eea0cae3f0de

A trio of recent deals tells us something important about capital markets: that 2020 may be the year when climate-risk analysis of portfolios moves out of a niche into the mainstream. Investors and boards have begun to realise that it can be more costly to ignore these issues, than to try to grapple with them. Last September MSCI, the global index company, bought Carbon Delta, a boutique focusing on climate risk analysis. A few months earlier Moody’s acquired Four Twenty Seven, a similar boutique. Last year ended with S&P making a move for sustainable index player RobecoSAM.

Author: Christopher K. Merker, Ph.D., CFA

Christopher K. Merker, PhD, CFA, is a director with Private Asset Management at Robert W. Baird & Co. and executive-in-residence and co-director of the Marquette S-Lab. He is also founder and chair of the board of Water + Energy Forward, a green bank focused on market-based climate solutions. He holds a PhD in investment governance and fiduciary effectiveness from Marquette University, where he has taught “Sustainable Finance” since 2009. He publishes Sustainable Finance and is co-author of The Trustee Governance Guide: The Five Imperatives of 21st Century Investing.

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