Moving towards low carbon, climate resilient economies

WITH just over a week until the UN's Framework Convention on Climate Change (UNFCCC) 21st Conference of the Parties (COP21) in Paris, the financial sector is increasingly focused on the role that it can play to support the transition towards low carbon, climate resilient economies. Commercial banks, insurance companies and investors alike are fast becoming aware of the increasing opportunities in sustainable business models, as well as the risks presented if they fail to act. Given Singapore's importance as a financial centre, we are pleased to be holding an event here to address these issues.

The Climate Finance Day in Paris in May highlighted a number of private sector initiatives which support this transition to a low carbon future and the UN objective to limit the rise of global temperatures to two degrees Celsius by the end of the century. During this event, financial organisations called on regulators to create a framework of incentives for sustainable financing and investment, citing the serious consequences of climate change for society, the global economy and environment. The aim would be to optimise the risk to return ratio working across international bodies, public authorities, non-governmental organisations, businesses and individuals to develop solutions to meet global environmental and economic challenges.

Global financial leaders are increasingly addressing the threat of climate change as highlighted in a recent speech to the insurance market by Mark Carney, the governor of the Bank of England, who warned of the risks from climate change as a "tragedy of the horizon" that will lead to financial crises and falling living standards unless the world's leading countries do more to ensure transparent accounting for current and future carbon emissions. Insurers are heavily exposed to climate change risks, and time is running out to deal with global warming.