The 2023 climate risk landscape

The past few years have demonstrated a remarkable level of volatility. Efforts to establish a “new normal” after the COVID-19 pandemic were interrupted by the Russian invasion of Ukraine, and a wave of food and energy crisis. Central bankers have continued to raise interest rates to tame inflation, ending the “lower for longer” regime that has persisted since the Global Financial Crisis. Amid these changes, societies must contend with the worsening effects of human-caused climate change and the critical economic transition to a net-zero emissions future. The impacts of climate change and the necessary transition will impact almost every human and natural system. Successful companies and communities will be ones that are resilient in the face of these challenges. Developing climate resilience and contributing to a sustainable future requires action today. Organisations that recognize this are seeking to better understand their climate risks and opportunities and the strategies they should pursue. Climate risk tools can assist in the decision-making process and by validating climate strategies and uncovering new insights about climate risk. The pace of development and deployment of climate risk tools within the financial sector has been breath-taking. UNEP FI’s 2023 Climate Risk Landscape report aims to assist financial actors in better understanding this diverse and dynamic landscape of climate risk tools. The report explores the major market trends in both physical risk and transition risk tools and provides detailed analysis on dozens of individual tools.

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