financial risk

This working paper presents evidence that litigation reduces firm value. This means that climate litigation should be considered a relevant financial risk by lenders, financial regulators and governments. Read more

In order to assess these imbalances, Miller et al (2023) estimate the demand for metals induced by the NGFS climate scenarios and outline the potential implications in terms of macro-financial vulnerabilities. Read more

This paper empirically estimates the material demand requirements for so-called ‘transition-critical materials’ (TCMs) implied under two climate scenarios and finds potentially serious supply ‘bottlenecks’ for three materials – copper, lithium and nickel – which are exacerbated if the transition is delayed. Read more

Containing global temperature rise to well below 2°C would require keeping a large proportion of existing fossil fuel reserves in the ground. This would result in fossil fuel resources that cannot be burned and fossil fuel infrastructure that is no longer used – these are known as ‘stranded assets’. Read more

The authors of this paper discuss qualitative, empirical, modeling, policy, and institutional research and identify priorities for future research. Read more

This paper outlines three perspectives on the emerging concept of double materiality, along with their implications for monetary and financial policy and the challenges they raise in theory and practice. Read more

This paper proposes an alternative, precautionary approach to financial policy that justifies bolder action in response to environmental-related financial risks.  Read more

Biodiversity loss poses a significant and under-appreciated threat to financial stability, and central banks and financial supervisors should act to confront nature-related risks, according to a new report published today (24 March 2022) by a group of central bankers, financial supervisors and academic researchers. Read more