This week's updates at a glance:

From the editors... Call for volunteers: Writing opportunity with the IFoA’s Actuaries Carbon Collaboration (ACC) IFoA Sustainability Board SDG survey In the spotlight... IFoA Impact Assessment Report 2021 In the news... India can achieve net zero in greenhouse gases emission by 2065-70 Climate change ETFs found to be undermining war on global warming Concerns about widespread lapses in climate risk reporting found in company accounts Glasgow climate summit at risk of failure, U.N. chief warns What we're reading... Global Update: Climate target updates slow as science demands action Tune in... Sustainability Series: What will COP26 mean for investment? Opinion... What smart people get wrong about climate change extremes

Call for volunteers: Writing opportunity with the IFoA’s Actuaries Carbon Collaboration (ACC)
 

 The ACC is a team of professionals who combine their skills to educate and create thought leadership on carbon. They have developed some great ideas but lacks the resource to showcase them externally. 

Therefore, they are looking for volunteers who can get those ideas down in writing (or as graphics). You don’t have to be an expert, simply someone who wants to get involved in this exciting and timely topic with time available as well as an inclination to write. 

Apply here (IFoA)

The IFoA Sustainability Board would like to hear from members about where their interests lie around the UN Sustainable Development Goals (SDGs). Please take a few minutes to answer a quick survey about how the SDGs relate to your actuarial work.

Complete the survey here (SurveyMonkey)

IFoA Impact Assessment Report 2021
 

 The actuarial profession brings unique value to successful business outcomes and. actuaries and affiliates have made significant contributions towards solving some of the major problems our societies face. Some of the highlights from the past year include:

Read more about the skills actuaries bring and the impact the profession is having here (IFoA)

India can achieve net zero in greenhouse gases emission by 2065-70
 

India, the world’s fourth largest emitter, would be among the most severely affected countries as a result of climate change. With COP26 approaching, there is pressure on India to commit to a net-zero target and a new study suggests that India can achieve net-zero by 2065-2070. 

However, to achieve such targets, India needs to conduct a planned phasing out of coal-based power generation. This is expected to cause huge revenue and employment loss for poorer Indian states as renewable sectors would be created in regions that have better solar and wind resources. 

A close aide of former Prime Minister Manmohan Singh argues India should not commit to a net zero target without enhanced international finance support. Not least because the energy transition for the developing world would be costlier as patents of almost all technologies are with western entities.

Read the article here (Hindustan Times)

 
The assets of self-proclaimed “sustainable” have funds tripled since 2018 to $2.3tn. However, new research suggests climate focused investment funds are undermining the fight against global warming by falsely claiming green credentials, also known as greenwashing. 

Passive exchange traded funds – those which generally buy and hold individual stocks – which track “low carbon” indices allocate little of their money to the greenest companies. The research also showed that climate data determines, at most, 12% of each stock’s weight.

Read the article here (FT)

Concerns about widespread lapses in climate risk reporting found in company accounts
 

Despite the increase in climate risk and pledges given by many companies around the globe, research by Carbon Tracker suggests that 70% of companies failed to account for climate risk in their financial statements. 107 companies were included in the study ranging from oil to consumer goods. Companies in Europe led in the transparency of consideration of climate in the financial statements.

While recent accounting and auditing standards clearly indicate that climate risks should not be ignored in financial statements, financials of these companies failed to disclose useful information such as the capital at risk, mitigation, and action plans to move towards a net-zero economy by 2050. 

Read the article here (Energy in Demand)

Glasgow climate summit at risk of failure, U.N. chief warns
 

United Nations (UN) Chief Antonio Guterres has warned upcoming meetings are at risk of failure because of a lack of multilateral co-operation and an element of distrust between developed and developing economies. Going further, Guterres emphasised how the world is failing to meet emission reduction targets and the problem is rapidly moving out of control.

The UN Chief, along with the UK PM Boris Johnson, will convene a meeting of world leaders with an aim to bridge the trust gap and set the expectations that more work needs to be done to improve the chances of better outcomes from the upcoming Glasgow summit.

Read the article here (Reuters)

Global Update: Climate target updates slow as science demands action
 

Sustainability Series: What will COP26 mean for investment?
 

A panel discussion hosted by the President of the IFoA, Louise Pryor, with investment representatives discussing the impact of investment on climate change and vice versa. Speakers include Steve Waygood (Chief Responsible Investment Office of Aviva Investors), Catherine Howarth (CEO of ShareAction) and Mike Clark (Director of Ario Advisory).

This event is part of The Road to Glasgow: IFoA’s Sustainability Thought Leadership Series which will provide a platform for prominent contributors so that our members and others can understand the perspectives of a wide range of parties interested in the climate debate.

Register here (IFoA)

What smart people get wrong about climate change extremes
 

A lot of focus is on the outcomes which we can predict with high confidence, but not much appreciation is given to the risks associated with new weather patterns we don’t yet understand. Decision makers don’t fully comprehend the second-order effects that extreme weather events can have on our social and economic systems. Some of these outcomes are hard to predict and that uncertainty will only grow the more fossil fuels we burn.

New scenarios produced for the central banks’ climate network only consider the effects of increases in temperature and exclude other factors such as extreme weather and sea-level rises. Compound events are still not well understood by the public, such as heavier precipitation and tropical cyclones.

Overall, we can see that industry and economic analysts are missing how different climate change impacts will interact with each other.

Read the piece here (Insurance Journal)

Communication is at the heart of shifting mindsets on climate and sustainability issues, and is vital in highlighting and understanding steps we can take as finance professionals to implement positive change.

The purpose of Sustainable Finance Community is to encourage members to read, share and discuss content, in order to help us with this aim. We want to encourage information to flow both ways, so please get in touch by replying to sustainablefinancecommunity@gmail.com or follow us on LinkedIn and Twitter.

The weekly newsletter summarises information from different sources for the benefit of subscribers. While we take care to select articles, papers and opinions from reputable sources, we do not perform independent verification and hence these summaries should not be relied upon for any purpose. Further, the statements, opinions and conclusions that are summarised within the newsletter do not necessarily represent the views of the IFoA nor the newsletter authors and their employers.

This initiative is brought to you by the Institute and Faculty of Actuaries (IFoA) Sustainability Board (formerly Resource & Environment Board). The Sustainability Board is a group of voluntary actuaries working with the IFoA to encourage change within finance. We work alongside - but separately to - the IFoA and as such this is not an IFoA communication. Find out more about the IFoA Sustainability Board here.

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