A new paper on “A climate stress-test of the financial system” was published on 27 MARCH 2017 in Nature Climate Change. 

Irene Monasterolo, Assistant Professor at the Institute for Ecological Economics, is one of the authors of the article.

Publication authors

Stefano Battiston1, Antoine Mandel2, Irene Monasterolo3, Franziska Schütze4 and Gabriele Visentin1

 

Affiliations

1 FINEXUS Center for Financial Networks and Sustainability, Department of Banking and Finance, University of Zurich, Andreasstr. 15, 8050 Zürich, Switzerland.

2 Université Paris 1 Panthéon-Sorbonne, Centre d’économie de la Sorbonne, Maison des sciences économiques, 106-112 Boulevard de l’hôpital, 75647 Paris Cedex 13, France.

3 Frederick S. Pardee Center for the Study of the Longer Range Future, Boston University, 67 Bay State Road, Boston, Massachusetts 02215, USA.

4 Global Climate Forum, Neue Promenade 6, 10178 Berlin, Germany. *e-mail: stefano.battiston@uzh.ch

Headline

The study develops a network-based climate stress-test to understand the degree to which financial actors’ investments are exposed to climate risk. It analyzes the impact of green (or brown) investment strategies and finds that investors’ portfolios in equity holdings bear large exposures to climate-policy-relevant sectors, and that pension funds are particularly affected. The results suggest that prompt and stable climate policies do not imply systemic risk. Rather, the lack of their implementation could lead to systemic adverse effects to the economy. The results are relevant to the ongoing debate on the need for asset managers and institutional investors to disclose to their clients their exposure to climate-relevant financial risk.

Find the Executive Summary here.

DOI: 10.1038/NCLIMATE3255