{"id":240,"date":"2020-01-16T13:22:38","date_gmt":"2020-01-16T17:22:38","guid":{"rendered":"http:\/\/blogs.duanemorris.com\/bankinglaw\/?p=240"},"modified":"2020-01-16T14:05:44","modified_gmt":"2020-01-16T18:05:44","slug":"climate-change-to-impact-finance","status":"publish","type":"post","link":"https:\/\/blogs.duanemorris.com\/bankinglaw\/2020\/01\/16\/climate-change-to-impact-finance\/","title":{"rendered":"Climate Change to Impact . . . Finance?"},"content":{"rendered":"

With much attention currently on geographic locations around the world where the effects of climate change are thought to be keenly felt, including the fires in Australia, rising seas in coastal areas and receding glaciers in the Arctic zone, the potential effects of climate change on other aspects of human culture, such as economic decision-making, has not always generated the same headlines. That is, until a bombshell article<\/a> published in the DealBook section of The New York Times<\/em> on January 14 noted that the world\u2019s largest asset manager would implement policies to evaluate investments based on issues of sustainability and climate change.\u00a0 As explained in the article, in the annual letter sent by Laurence D. Fink, founder and chief executive of BlackRock, which has nearly $7 trillion in investments, to the CEOs of the largest companies in the world, BlackRock announced that it intends to exit investments to the extent they \u201cpresent a high sustainability-related risk.\u201d\u00a0 Cited as potential targets for divestiture are fossil fuel businesses and companies whose management is not sufficiently focused on sustainability. \u00a0Mr. Fink insists that fiduciary concerns are driving these policies, not politics, suggesting that, in BlackRock\u2019s view, shareholders should evaluate a company\u2019s stewardship of the planet when considering the company\u2019s stewardship of its own business.<\/p>\n

BlackRock\u2019s announcement was pivotal in that it was issued by a major institutional player in the capital markets and evidences a policy not just of funding \u201cgreen projects,\u201d a socially-conscious investment strategy that has been employed by other financiers, but of specifically targeting for divestiture companies engaging in business practices that may have deleterious effects on the environment.<\/p>\n

Notably, the NYT article on BlackRock was not the only interesting news on the economic threats posted by climate change. \u00a0On January 16, The Wall Street Journal<\/em> weighed in on this topic in \u201cFor the Economy, Climate Risks Are No Longer Theoretical<\/a>.\u201d \u00a0Writing for WSJ, author Greg Ip leads off with an observation on how the Australian bushfires will negatively affect the Australian economy, he then notes that \u201c[c]limate has muscled to the top of business worries\u201d and financial losses related to climate change may not be subject to successful hedging or recoupment through adaptation or insurance.<\/p>\n

It remains to be seen whether BlackRock\u2019s position is the start of a trend toward more focus by banks and other financial institutions on climate-related issues in their lending and finance activities, or whether BlackRock remains a lonely voice on this issue in the capital markets.<\/p>\n","protected":false},"excerpt":{"rendered":"

With much attention currently on geographic locations around the world where the effects of climate change are thought to be keenly felt, including the fires in Australia, rising seas in coastal areas and receding glaciers in the Arctic zone, the potential effects of climate change on other aspects of human culture, such as economic decision-making, … <\/p>\n

Continue reading “Climate Change to Impact . . . Finance?”<\/span><\/a><\/p>\n","protected":false},"author":47,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[192,189,191,190],"ppma_author":[343],"class_list":["post-240","post","type-post","status-publish","format-standard","hentry","category-general","tag-blackrock","tag-climate-change","tag-finance","tag-mairi-luce"],"authors":[{"term_id":343,"user_id":47,"is_guest":0,"slug":"luce","display_name":"Mairi V. Luce","avatar_url":"https:\/\/blogs.duanemorris.com\/bankinglaw\/wp-content\/uploads\/sites\/14\/2014\/08\/lucemairi-125x150.jpg","0":null,"1":"","2":"","3":"","4":"","5":"","6":"","7":"","8":""}],"_links":{"self":[{"href":"https:\/\/blogs.duanemorris.com\/bankinglaw\/wp-json\/wp\/v2\/posts\/240","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.duanemorris.com\/bankinglaw\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.duanemorris.com\/bankinglaw\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/bankinglaw\/wp-json\/wp\/v2\/users\/47"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/bankinglaw\/wp-json\/wp\/v2\/comments?post=240"}],"version-history":[{"count":0,"href":"https:\/\/blogs.duanemorris.com\/bankinglaw\/wp-json\/wp\/v2\/posts\/240\/revisions"}],"wp:attachment":[{"href":"https:\/\/blogs.duanemorris.com\/bankinglaw\/wp-json\/wp\/v2\/media?parent=240"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/bankinglaw\/wp-json\/wp\/v2\/categories?post=240"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/bankinglaw\/wp-json\/wp\/v2\/tags?post=240"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/bankinglaw\/wp-json\/wp\/v2\/ppma_author?post=240"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}