Climate Risks: Physical, Transition, Liability, Social and Financial

Environmental
:   
Climate Risk & Adaptation
March 17, 2023
  1. Physical risks: These are risks related to the physical impacts of climate change, such as rising sea levels, increased frequency and severity of storms, floods, heatwaves, droughts, and wildfires.
  2. Transition risks: These are risks related to the economic and societal transitions that are necessary to mitigate climate change, such as changes in policy, technology, and market dynamics that could lead to stranded assets, changes in demand for certain products or services, and shifts in global supply chains.
  3. Liability risks: These are risks related to legal liability or reputational harm that could arise from a failure to adequately respond to climate change, such as lawsuits or negative public perception.
  4. Financial risks: These are risks related to the financial impacts of climate change, such as changes in the value of assets or investments due to physical or transition risks, or changes in creditworthiness or insurability.
  5. Social risks: These are risks related to the social impacts of climate change, such as displacement of communities due to sea-level rise or other physical impacts, or social unrest due to economic or political instability resulting from climate change.

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