The top climate risk news highlights for February

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#1. SEC Chair Gary Gensler Defends Easing of Proposed Climate Risk Disclosures 

In an interview with CNBC’s Squawk Box on February 10, 2023, SEC Chairman Gary Gensler said the Security and Exchange Commission is considering easing the climate risk disclosure rule it issued last year after receiving 15,000 public comments on the proposal. 

The proposed rule, “Enhancement and Standardization of Climate-Related Disclosures for Investors”, requires publicly traded companies to disclose to investors how their operations affect the climate and contribute to carbon emissions. 

The SEC chair pushed back against suggestions that his agency is responding directly to pressure from investors. The full article can be viewed on CNBC. Jupiter shared its strong support for climate risk disclosures in a 2022 blog post.  

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#2. UN News - Rising Seas Pose Unthinkable Risks to Billions  

Just days after SEC Chairman Gary Gensler told Squawk Box that the SEC is considering easing the climate risk disclosure rule it set in motion last year due to 15,000 public comments about the proposal, UN News filed a story about senior officials and the Security Council hosting their first-ever debate on climate change’s global implications. 

UN Secretary-General António Guterres who opened the meeting commented “The impact of rising seas is already creating new sources of instability and conflict,” highlighting that some coastlines  have already seen triple the average rate of sea level rise, he warned that, in the coming decades, low-lying communities – and entire countries – could disappear forever. 

In his plea, he warned “We would witness a mass exodus of entire populations on a biblical scale, and we would see ever-fiercer competition for fresh water, land and other resources.” 

Guterres shared concerns that climate change could impact our food and water supplies and healthcare and that major cities will face impacts and the danger is especially acute for some 900 million people living in coastal zones at low elevations –one out of every ten people on earth. The Washington Post has the full story. 

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#3. U.S. Banks Ask Regulators to Take a Harmonized Approach to Climate-Risk Reporting Rules  

In mid-February, while U.S. banks welcomed a proposal to incorporate climate change risks into their daily operations, many banks urged regulators to align on climate risk management guidance in order to avoid duplicative efforts. 

According to a Reuters article, banks opposed prescriptive risk management and lending criteria, exposure disclosures and capital penalties. Among many concerns banks shared with the Office of the Comptroller of the Currency (OCC) was the complexity of identifying, sourcing and modeling climate related data over long time horizons. 

The Institute of International Finance (IIF) called for a harmonized approach in a written response to the OCC stating climate risk is a global issue that warrants a coordinated and harmonized approach across jurisdictions, including in supervisory principles and standards with respect to climate risk management.

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#4 Government, Academia, Economists and the Private Sector Convene on Blue Chip Climate-Risk Macroeconomic Forecasts

On February 22, The Council of Economic Advisers, National Economic Council, Office of Management and Budget, Office of Clean Energy Innovation and Implementation, and Climate Policy Office convened to discuss Blue Chip Climate-Risk Macroeconomic Forecasts. The goals of the meeting included: 

• Identifying ways to incorporate transition risks of climate change into macroeconomic forecasting.  

• Sharing methodologies developed or considered to date and identify important data gaps or missing modeling capabilities.

• Elevating the visibility of private-sector assessment and management of climate-related macroeconomic risks in policymaking, and vice-versa.

Climate change and its risk to the macroeconomy was the one central challenge guiding the goals and the required policy to address it. As stated in the briefing room document, the physical risks of a changing climate will alter the trajectory and composition of economic growth. Given the scale of the risks from climate change, it is critical that we better understand and manage their effects throughout the economy.   

This wraps February’s top climate related news highlights. For more information on how Jupiter’s forward-focused, rigorous methodologies and analytics delivered by some of the best scientists in the industry, turn sophisticated climate science into actionable data. By managing, mitigating, and disclosing your climate risk, you can confront the challenges of tomorrow, today.

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