INTENSIFYING REGULATIONS

 

CLIMATE-RELATED FINANCIAL DISCLOSURES

On December 4, 2015, the Financial Stability Board (FSB) established the industry-led Task Force on Climate-related Financial Disclosures (TCFD) with Michael R. Bloomberg as Chair and 31 members in total. Elion House and 513 companies, banks, insurers, and investors have expressed their support for the TCFD as of the One Planet Summit held in New York on September 26, 2018. (Learn more)

The TCFD … “establishes recommendations for disclosing clear, comparable and consistent information about the risks and opportunities presented by climate change. Their widespread adoption will ensure that the effects of climate change become routinely considered in business and investment decisions. Adoption of these recommendations will also help companies better demonstrate responsibility and foresight in their consideration of climate issues. That will lead to smarter, more efficient allocation of capital, and help smooth the transition to a more sustainable, low-carbon economy.

Since the Task Force began its work, we have also seen a significant increase in demand from investors for improved climate-related financial disclosures. This comes amid unprecedented support among companies for action to tackle climate change. The risk climate change poses to businesses and financial markets is real and already present. It is more important than ever that businesses lead in understanding and responding to these risks—and seizing the opportunities—to build a stronger, more resilient, and sustainable global economy.”

 

CARBON TAX 

51 countries have implemented carbon pricing schemes, and 88 countries have stated their intent to implement as part of their national climate policies. It is estimated that achieving the goals of the Paris Agreement requires a carbon price of US$40-$80/tCO2 by 2020, rising to US$50-$100/tCO2 by 2030. Sweden which has the highest carbon price at US$139/tCO2 is a success story.

“Carbon prices vary widely across existing schemes. Success stories such as that of Sweden – which currently has the highest carbon price in the world at US$139/tCO2 – demonstrate that it is indeed possible to make carbon pricing work: While the Swedish economy grew by 60% since the introduction of the Swedish carbon tax in 1991, carbon emissions decreased by 25%.

 

 

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