Hear from David Carlin, Head of Risk at the UNEP Finance Initiative, as we dive into their latest reports covering the climate risk tool landscape, the use of AI in disclosures, and 1.5 degree warming scenarios. As the world’s leading authority on the environment, the United Nations Environment Programme (or UNEP), has a mission to inspire, inform, and enable nations and peoples to improve their quality of life, without compromising that of future generations. And, they recognise the critical role of the financial system in achieving this goal. Through UNEP FI – their Financial Initiative – they convene networks of banks, insurers and investors to help accelerate sustainable development, as well as manage the associated risks.  Today’s guest is an energetic part of this network, helping financial firms tackle issues such as climate scenario analysis, climate risk assessments, and navigating the world of sustainability regulation. In this episode, we’ll explore some key insights from his work, including: ·       How the landscape of climate risk tools and analytics providers is changing, for example with the increased use of Machine learning and AI; ·       The challenges of translating the science of climate change to actionable insights for financial practitioners. ·       And our guests’ secrets for reaching 100,000 followers on LinkedIn to help drive awareness of these vitally important topics. To find out more about the Sustainability and Climate Risk (SCR®) Certificate, follow this link: https://www.garp.org/scr For more information on climate risk, visit GARP’s Global Sustainability and Climate Risk Resource Center: https://www.garp.org/sustainability-climate If you have any questions, thoughts, or feedback regarding this podcast series, we would love to hear from you at: [email protected] Links from today’s discussion: UNEPFI homepage – https://www.unepfi.org/ UNEPFI’s 2024 Climate Risk Landscape Report – https://www.unepfi.org/themes/climate-change/2024-climate-risk-landscape/ David Carlin’s LinkedIn page - https://www.linkedin.com/in/david-carlin7/ Speaker’s Bio David Carlin, Head of Risk, United Nations Environment Programme Finance Initiative (UNEPFI) David and his team support financial actors across the world to develop best practices for managing environmental risks and identifying environmental opportunities. Alongside his current role, David advises the Task Force on Nature-related Financial Disclosures (TNFD) and the Net-Zero Banking Alliance (NZBA) and is the founder of Cambium Global Solutions, which helps governments, corporations, and financial institutions address environmental challenges. Prior to his current role, David worked as a Principal in Finance, Risk, and Public Policy for Oliver Wyman.

Hear from Ron Dembo, Founder and CEO of riskthinking.ai, as we apply stochastic thinking to the challenge of climate scenario analysis. One of the most difficult aspects of managing climate risk is its inherent uncertainty. Because we can’t know with absolute confidence what our future climate, economy or society will look like, we therefore can’t know exactly when, where, or how intensely climate risks will manifest. A technique commonly applied to this problem is scenario analysis. By building a picture of what the future might look like, firms can formulate risk management strategies appropriate for that scenario. However, today’s guest believes we’re only scratching the surface of what scenario analysis can do for our financial institutions. In today’s episode, we’ll home in on the idea of stochastic scenario analysis; what it is, how it works, and what makes it different to the traditional approach to scenario analysis. We’ll explore: ·       The difference between deterministic and stochastic scenario analysis; ·       The advantages of using large sets of scenarios generated by expert judgment; and ·       What stochastic scenario analysis means for risk professionals.   To find out more about the Sustainability and Climate Risk (SCR®) Certificate, follow this link: https://www.garp.org/scr For more information on climate risk, visit GARP’s Global Sustainability and Climate Risk Resource Center: https://www.garp.org/sustainability-climate If you have any questions, thoughts, or feedback regarding this podcast series, we would love to hear from you at: [email protected] Links from today’s discussion: ·       https://riskthinking.ai/   Speaker’s Bio Ron Dembo, Founder and CEO, riskthinking.ai Ron is an academic, author, entrepreneur, and consultant to the some of the world’s largest corporations and banks. He has had a distinguished academic career as a professor at Yale University and as visiting professor at MIT. He is a Lifetime Fellow of The Fields Institute for Research in Mathematical Sciences, and has received numerous awards for his work in mathematical optimization, finance, and climate change. Ron was previously the Founder and CEO of Algorithmics, an enterprise risk management software provider with over 70% of the world’s top 100 banks as clients. After Algorithmics was acquired by Fitch Group, Ron later founded riskthinking.ai, a company pioneering the use of stochastic analysis to accurately price climate risk into the financial markets.

In today’s episode we will be returning to the topic of climate disclosures, looking specifically at the advancements in TCFD adoption across the banking sector. In 2019 we recorded a podcast that discussed the early adoption of the TCFD across the banking sector. Now, just 2 years on, we are starting to see a number of countries laying out plans for mandatory TCFD reporting. Expectations around the quality of climate disclosures are rising and we are seeing the TCFD transitioning to become a part of business as usual reporting. That is why today’s discussion will be focused on learning from those already reporting to better understand what firms are doing well, as well as where improvements can be made. This episode will directly address: what banks are doing well and what needs to be improved; whether or not general-purpose lending needs to become more closely tied with emissions or other green indicators; and why TCFD reporting remains fragmented and what to do about it   In memory of Roger Gifford We wanted to take this opportunity to pay tribute to Sir Roger Gifford who sadly passed away in May. Among his many accomplishments, he was a respected banker, former Lord Mayor of the City of London and Chair of the Green Finance Institute, playing a leading role in driving the green finance agenda in the UK.  As someone who was always keen to support work promoting sustainable finance, he has been a good friend to GARP and was happy to write the Forewords to both BCS Consulting reports on TCFD discussed in this episode. We dedicate this episode of the podcast to his memory.    Links from today’s discussion: Our previous podcast with Hector: https://garpcast.libsyn.com/tcfd-global-progress-for-the-banking-sector BCS’ TCFD Report - Global Progress for the Banking Sector: http://www.bcsconsulting.com/wp-content/uploads/2021/05/BCS-TCFD-Global-Progress-Report-for-the-Banking-Sector-060521.pdf For more information on climate risk, visit GARP’s Climate Resources Hub: https://climate.garp.org/   If you have any questions, thoughts or feedback regarding this podcast series, we would love to hear from you at: [email protected]   ------------------   Hector Fontaine - Principal Consultant at BCS Consulting   Hector is a Risk & Finance management consultant and Sustainable Finance lead for BCS Consulting. BCS Consulting is focused on delivering complex business change projects to clients in banking and financial markets, working across Capital Markets, Retail & Corporate Banking and Finance & Risk functions in some of the world’s leading financial institutions. Hector, as Sustainable Finance Lead, has expertise spanning finance and risk. Over the past few years, he has directed and co-authored a number of significant research papers, including the ESG Banking Benchmark Report back in 2018, and more recently two comprehensive reviews of the adoption and implementation of TCFD in the banking sector.

In this instalment of the Climate Risk Podcast we are turning our attention to agriculture, forestry and land use, a sector that both affects, and is affected by, climate change. Producing approximately 20% of total global greenhouse gasses, agriculture, forestry and land use is considered the second largest source of emissions after energy production, making it a critical focus for global decarbonisation. But the sector’s sensitivity to changes in temperature and precipitation, as well as extreme weather more generally, means that it is also particularly vulnerable to the effects of climate change. With that said, there are positives to be drawn out of this situation. This is because many of the responses needed to the sector’s high emissions and physical vulnerabilities overlap to create compelling win-win situations. Well placed investments in agriculture combine emissions reductions with resilience building which, in turn, reduce financial risks for the sector. To illustrate this, today’s episode will have three points of focus: How financial institutions can support the sector in locating and acting upon opportunities to reduce climate risk and build resilience The role of data in successfully identifying and responding to these win-wins The lessons that we can take from this sector and apply elsewhere   Environmental Defense Fund (EDF) Website: https://www.edf.org/ Financing Resilient Agriculture Report: https://www.edf.org/sites/default/files/content/Financing_Resilient_Agriculture_Report.pdf For more information on climate risk, visit GARP’s Climate Resources Hub: https://climate.garp.org/   If you have any questions, thoughts or feedback regarding this podcast series, we would love to hear from you at - [email protected]   ------------------   Maggie Monast - Director of Working Lands at Environmental Defense Fund (EDF)   During the past 10 years, Maggie has held a variety of roles at EDF, working with farmers, food companies, agricultural organizations, and others, such as financial firms, to create an agricultural system that drives climate stability, clean water, and food security. Maggie works to quantify the farm financial impacts of conservation practice adoption, collaborates with major corporations to develop sustainability initiatives, and develops innovative financial incentives to advance sustainable agriculture.