Five Key Takeaways from IPCC’s New Climate Science Report

GRI Logo Thumbnail

August 25, 2021

GRI LogoThe financial sector should move quickly to seize opportunities opening up to finance the economy of a greener tomorrow, the Global Risk Institute says in response to the report Climate Change 2021: The Physical Science Basis, published August 9 by the United Nations working group Intergovernmental Panel on Climate Change (IPCC).

In a short opinion article entitled, “We Are on the Bell Lap: Top 5 Takeaways from the IPCC’s New Climate Science Report”, Canada’s premier agency on risk management offers five key takeaways for financial institutions in response to the IPCC’s latest report which sent a shot across the bow for humanity on the state of the climate.

“Now is the time for Canada to come together across government, industry and academia and punch above our weight,” says Sonia Baxendale, President and CEO, Global Risk Institute.

“Industry must pick up the pace. We have an obligation to our stakeholders, shareholders and future generations to face an unprecedented challenge and drive the innovation needed to create a sustainable low-carbon economy today – not in the distant future.”

Canadian financial institutions provide capital and leverage to the country’s societal and economic activity. Accordingly, they must play their part in managing and mitigating climate risk and accelerating low carbon opportunities.

The paper offers five key takeaways from the IPCC report for financial institutions:

1. Canada is in the cross-hairs, and the world agrees – modelled projections see a larger than average temperature increases for Canada due to its geographic location. In a year of catastrophic storms, fires and droughts, Canadamust accelerate the urgency to lower carbon emissions in the short term.

2. Clearer, data-drive future scenarios are now possible – recent scientific breakthroughs now bring more resolution to climate risk assessment, better data for climate risk scenario analysis, and updated set of IPCC net zero pathways.

3. Liability risk set to rise as human influence on the climate is now “unequivocal” – amplified liability risk is expected from two breakthrough findings of the IPCC report: greenhouse gases by humans is causing climate change and scientists are now able to link specific weather events to human-made climate change.

4. Doubling down on transition finance and the move to a low carbon economy – financing and underwriting of fossil fuels must support energy diversification toward renewables, and transparency from firms about net zero portfolio alignment and climate-related financial risk must increase.

5. Investment in the one entity that can soften the blow: Mother Earth – with some major impacts of climate change such as sea level rise a certainty, there will be a scramble for financial resources to adapt, build resilience and invest in nature-based solutions to buffer the impacts. In response, the financial sector should develop ‘climate adaptation finance’ as a tool within the sustainable finance umbrella.

Source

Related Articles


Latest Articles


Changing Scene

  • Have your Say on the Proposed Regulations for the NWT Builders’ Lien Act

    Have your Say on the Proposed Regulations for the NWT Builders’ Lien Act

    February 14, 2025 The GNWT is modernizing the legal framework for construction liens. In 2023, the Builders’ Lien Act was enacted to replace the Mechanics Lien Act. The new legislation was put in place to address modern construction practices. It sets out the legal processes, systems, rights, and remedies for parties involved in construction disputes.  The GNWT… Read More…

  • Federal Government Investing in Skilled Trades Training for Atlantic Canada

    Federal Government Investing in Skilled Trades Training for Atlantic Canada

    February 14, 2025 Canada is building more homes, bridges and key infrastructure than at any point in recent history. That requires skilled workers in communities across the country, including in the Atlantic provinces. To encourage more people to join the skilled trades, to build the homes Canadians expect and the resilient economy this moment demands,… Read More…

  • Nova Scotia Power Holding Open Houses to Discuss Modernizing the Electrical Inspections Process

    Nova Scotia Power Holding Open Houses to Discuss Modernizing the Electrical Inspections Process

    February 14, 2025 As Nova Scotia continues to experience unprecedented building growth, it’s the perfect time to review and improve the electrical inspection process—with safety as the top priority. Nova Scotia Power and the Department of Labour, Skills, and Immigration are coming together to explore new opportunities—including risk-based electrical inspections—to ensure the process remains safe,… Read More…

  • Alberta EV Tax Begins February 13th

    Alberta EV Tax Begins February 13th

    February 14, 2025 Starting Thursday, Feb. 13, Albertans will be charged a $200 tax when they register their electric vehicles. This amount is in line with what drivers of a typical internal combustion engine vehicle would be expected to pay each year in fuel tax. The tax will be collected by registry agents, and online… Read More…