Cash, value and climate change
A rise in sea levels? It's ok, I live on a hill. Melting glaciers? Great, the northwest passage will be passable. Increases in temperature? Good, even better English wine. A halving of the value of my portfolio? Quick, those politicians had better agree something soon on climate change in Paris.....
Lack of action on climate change could see portfolios lose close to 50% of their value, according to research conducted by the University of Cambridge.It warns that investors will be unable to hedge against certain climate risks but concedes that it is difficult for investors to distinguish between the types of risk they can counteract and those that can only be addressed by an overhaul of the economy.The University of Cambridge Institute for Sustainability Leadership projects future global growth based around three scenarios: 1) a global agreement to limit temperature increases to 2° C; 2) the economy continues with the current level of mitigation; and 3) there are no further efforts to mitigate climate change.It finds a notable impact in the short term when global-temperature increases are limited to 2° C and governments opt for no mitigation.”
