An email from Director Andy Pitman highlights the importance of climate research and how it can link back to inform big business, here and overseas.

Dear all,

Sometimes there are speeches by important people actually worth reading. Here is a link to a recent speech by Geoff Summerhayes. Mr Summerhayes is quite important which is why his speech was reported in the Sydney Morning Herald. He is a member of the Australian Prudential Regulation Authority (APRA). APRA can make the big banks jump – technically they could revoke their licences.

 

Now, in Mr Summerhayes speech are a few things you might miss but are profoundly important. He notes that Blackrock and Vanguard recently voted in favour of a resolution that ExxonMobil and Occidental Petroleum should publish reports on the impact of climate change on their business. It will help if you know Blackrock and Vanguard are the world’s two biggest investment management firms. That is, these companies have to actually document how climate change will affect them and they cannot fib since if they do they are misleading the market.

There are statements on how APRA is encouraging Australian companies to stress test for climate change. An absolute killer line is “APRA hasn’t conducted any stress tests specifically related to climate risk, but in the future we will consider doing so”.

This is terrifying to any business that has not yet thought about how climate change adds risk to their business.

Have a read of the speech – and think about how the research you are doing within the ARC Centre for Climate Extremes might inform these sorts of areas. For some of you, there will be nothing useful here, but for others you might be able to see how what you are doing is emerging as profoundly relevant to the national and international financial sector.

Andy