Traditional response to rising levels of risk – to re-price, withdraw or transfer exposure to others – will always remain a central feature of how insurance manages its risk pools. However, society will struggle to reduce the climate risk protection gap – the growing divide between total economic and insured losses – if the insurance industry’s response to climate change is limited to avoiding, rather than managing the risk. Managing societal resilience to climate change will therefore become more important as exposure intensifies.
In response, ClimateWise’s Societal Resilience Programme, of which this study is part, brings ClimateWise members together with a range of stakeholders to identify actionable solutions for how the insurance industry can support society’s transition to a zero carbon, climate-resilient economy. It explores this via the industry’s investment activities.
December 2016 – Investing for Resilience explores how the insurance industry can contribute to redirecting substantial flows of capital into resilience enhancing investments. This includes helping in the development of a resilience rating system.
December 2016 – The ClimateWise Principles Independent Review 2016 of the six ClimateWise Principles finds a second year of improved scores for members of the insurance industry leadership group. Members have demonstrated their ongoing support for the zero carbon, climate-resilient transition yet the report finds a need for the industry to do more within its investment activities.
September 2016 – At the invitation of the China Banking Regulatory Commission, the University of Cambridge Institute for Sustainability Leadership (CISL) and the Banking Environment Initiative worked with the Chinese banking industry to ask whether it is possible to green the finance of China’s commodity imports, and thereby address the risks associated with unsustainable agricultural production.
September 2016 – The G20’s new Green Finance Study Group asked the Cambridge Centre for Sustainable Finance to serve as Knowledge Partner and make recommendations on how to integrate environmental risk into mainstream financial decision-making.
May 2016 – As fiduciaries, investors gain by helping beneficiaries make informed choices about the management of their savings and investments. This report aims to help the investment industry empower savers to understand the impact of their investments on the critical challenges of our generation and to invest in line with their world views.