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Climate change has financial ramifications, and stakeholders are placing more emphasis on risk management protocols to assess and account for climate threats. On the Cleaning Up media platform, moderator Michael Liebreich interviews finance expert Bob Litterman on financial risk management in the context of climate. Litterman, a former Goldman Sachs economist, argues that time is of the essence in addressing the costs of global carbon emissions. Executives interested in a robust assessment of risk management in an era of climate change will find this an informative analysis.

Summary

Time is running out to create a zero-carbon future and to mitigate environmental impacts. 

Sustainability professionals insist that the worldwide lack of action toward mitigating the global carbon footprint poses grave threats for humanity’s future. If government and business had taken steps even 20 years ago, the likely scenarios for coming decades would be far less severe and much easier to manage from a risk perspective. Unfortunately, because of delays and a limited sense of urgency, many climate experts believe that time is no longer an ally and that Earth may have passed the tipping point.

In this context, policy officials must consider two distinct time markers: “commitment time and impact time.” The former refers to the several decades ahead, in which stakeholders must massively decrease ...

About the Speakers

Bob Litterman is a founding partner at Kepos Capital. Michael Liebreich hosts the Cleaning Up media platform, which focuses on clean energy, climate dynamics and sustainability issues.


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    T. T. 1 year ago
    The urgency to address climate change is undeniable. Delays in taking meaningful action on carbon emissions have brought us to a critical point. If we had acted sooner, the future outlook would be less dire. The consequences of inaction are evident in rising sea levels, extreme weather events, and other catastrophes. To mitigate this, policy officials need to set carbon pricing mechanisms and encourage businesses to disclose climate risks. The cost of transitioning to a net-zero economy is high, but the cost of inaction is far greater. Time is a precious resource, and we must act swiftly to safeguard the future.