Jun. 17, 2022
June 17, 2022 Climate change is a global crisis impacting every region of the world, and it is accelerating. Extreme weather and climate-related disasters are becoming more frequent and intense, and are causing irreversible damage to the ecosystems that human civilization depends on to survive and thrive. This is a statement of fact based on broad scientific consensus. The impact of this destruction is already having dire consequences for many communities and nations, and will soon be felt across all financial sectors, even in wealthy countries like the United States. The financial risks posed by climate change to investors, other market participants and the economy are real, and well documented by numerous government studies. Investors and other market participants deserve to have all the information they need to make informed decisions in the face of climate impacts. The economic impact of climate change is clear. Last year in the U.S. alone, climate change-fueled extreme weather events caused more than $145 billion worth of damage. Over the next decade, climate disasters are predicted to increase both in number and severity. These events, from increasingly severe wildfires to more frequent flooding, affect numerous corporate assets and operations, putting pressure on essential supply chains, posing harm to facilities, and undermining the ability of businesses to meet targets. Investors need to be aware of how companies are impacted by the financial risks of climate change when making decisions about their portfolios. Disclosure requirements are an essential component of ensuring that the corporations most responsible for creating and accelerating the climate crisis are accountable for their actions and inactions.