Green stress test for Dutch economy

Written by redacteur on . Posted in 2018, Climate & Environment, Climate Change, Compliance, Corporate, Economy, Economy and Labour Market, English, Enterprise, Finance, Governance, Government, Insurance, Leadership, Nederland, Project management, Public Risk, Report, Research, Safety, Society, Strategy.

An energy transition risk stress test for the financial system of the Netherlands

De Nederlandsche Bank

Almost 200 countries have signed the Paris Agreement: a pledge to keep the global temperature rise well below 2 degrees Celsius. To realize this pledge, global greenhouse gas emissions will need to be reduced substantially. This, in turn, requires a global transition to a low-carbon economy and energy system.

Such an energy transition may give rise to shocks that could be disruptive for the financial system. This Occasional Study investigates the potential financial stability impact of a disruptive energy transition for the financial sector of the Netherlands by conducting a stress test.

Several organizations have recommended the use of stress tests in relation to climate-related risks. The European Systemic Risk Board (2016), for example, recommends European Supervisory Authorities to include a disruptive energy transition scenario into their stress test exercises.

Similarly, the Financial Stability Board’s Task Force on Climate-related Financial Disclosures (2017a) has recommended firms to use scenario analysis and stress testing in the context of climate-related risks. To date, however, practical experience with stress testing climate-related risks is still limited. In addition to shedding light on the financial stability risks for the Netherlands associated with the transition to a low-carbon economy, therefore, this study attempts to make a contribution to energy transition risk stress testing.

In the transition to a low-carbon economy, risks to financial institutions and financial stability may arise. At present, fossil fuels still hold a central place in the production and consumption of energy. Economist Nicholas Stern has pointed out that because of this, the necessary reduction in CO2 emissions will require drastic changes to the global economy and energy systems (Stern, 2008, especially pp.7-8).

In a speech to the UK insurance sector in 2015, Bank of England governor Mark Carney warned that this energy transition could give rise to financial risks (Carney, 2015). In particular, technological breakthroughs or abrupt changes in government policy may trigger a reassessment of asset values which could affect financial institutions’ balance sheets. If this were to happen on a large scale, there could be an impact on financial stability.Read more

The Guardian on warming oceans

Written by redacteur on . Posted in 2019, Climate & Environment, Climate Change, Compliance, Country, Crisis & Disaster, English, Essay, Global Risks Report, Government, Public Risk, Risk Management.

The Guardian view on warming oceans: a rising toll

Talking about public risks. Now with the latest Global Risks Report 2019 on the table it seems that we humans increase the speed of disruption. We are collectively acting too slow in correcting and managing our common public risks. We bring this editorial of The Guardian under your attention.

“What we can be certain about is that the extraordinary diversity of life in the oceans is under immense and growing threat. This week we learned that the last five years were the hottest on record. Global warming has heated the oceans by the equivalent of one atomic explosion per second for the last century and a half; in recent years the pace has accelerated to between three and six atomic bombs per second.”

Global Risks Report 2019

Written by redacteur on . Posted in 2019, Business, Climate & Environment, Climate Change, Corporate, Crisis & Disaster, Cyber Security, Economy, Economy and Labour Market, Enterprise, Global Risks Report, Governance, Government, Leadership, Public Risk, Report, Risk Management.

World Economic Forum

The  report is published against a backdrop of worrying geopolitical and geo-economic tensions. If unresolved, these tensions will hinder the world’s ability to deal with a growing range of collective challenges, from the mounting evidence of environmental degradation to the increasing disruptions of the Fourth Industrial Revolution.

The report presents the results of our latest Global Risks Perception Survey, in which nearly 1,000 decision-makers from the public sector, private sector, academia and civil society assess the risks facing the world. Nine out of 10 respondents expect worsening economic and political confrontations between major powers this year. Over a ten-year horizon, extreme weather and climate-change policy failures are seen as the gravest threats.

This year’s report includes another series of “what-if” Future Shocks that examine quantum computing, weather manipulation, monetary populism, emotionally responsive artificial intelligence and other potential risks. The theme of emotions is also addressed in a chapter on the human causes and effects of global risks; the chapter calls for greater action around rising levels of psychological strain across the world.

Read online

Global Risks Report 2019 

Forget Trump remember climate change

Written by redacteur on . Posted in 2018, Climate & Environment, Climate Change, Compliance, Country, Crisis & Disaster, English, Governance, Government, In the news, Safety.

John Kerry: Forget Trump. We All Must Act on Climate Change.

John Kerry. 

This week is the third anniversary of the Paris climate agreement. The Trump administration marked it by working with Russia and Gulf oil nations to sideline science and undermine the accord at climate talks underway in Katowice, Poland…Future generations will measure us by whether we acted on facts, not just debated or denied them.  Read more

Climate change: what now?

Written by redacteur on . Posted in 2018, Climate & Environment, Climate Change, Compliance, Country, Crisis & Disaster, English, Governance, Government, Research, Safety.

Climate change: Where we are in seven charts and what you can do to help

Source: BBC

Representatives from nearly 200 countries are gathering in Poland for talks on climate change – aimed at breathing new life into the Paris Agreement.

The UN has warned the 2015 Paris accord’s goal of limiting global warming to “well below 2C above pre-industrial levels” is in danger because major economies, including the US and the EU, are falling short of their pledges. Read more

“Human beings are the biggest risk to innovations”

Written by redacteur on . Posted in 2018, Climate & Environment, Climate Change, Corporate, English, Governance, Information management, Nederland, Perspective, Public Risk, Research, Society.

Inaugural lecture Mariëlle Stoelinga.

The Dutch have no problem texting while cycling and are happy to install solar panels, but are troubled by nuclear energy and afraid of terrorist attacks. These are just a few situations in which people act and react based on intuition instead of reason. Because looking at the statistics, one can see that a terrorist attack is far less likely than causing an accident while texting on a bike.

By the same token, figures suggest that a greater reliance on nuclear energy has more positive effects on the environment than a rise in the number of solar panels. Even so, people tend to trust their intuition. Welcome to the world of Professor Mariëlle Stoelinga, who today gives her inaugural lecture as Professor of Risk Management for High-Tech Systems at the UT.

The professor knows where the trouble begins. “Not many people are trained in the principle of calculating risks in advance. And that means they often see techniques for calculating probability and risk models as time-consuming and complicated. But as systems become increasingly complex and diverse technologies are integrated, it is more essential than ever that we continue to oversee the entire process. Without risks there can be no progress and innovation is simply not possible. But the risks we take should be calculated risks, ones that we have examined systematically and explained clearly to the outside world.” Read more

Strong risk of climate crisis before 2040

Written by redacteur on . Posted in 2018, Climate & Environment, Climate Change, Crisis & Disaster, English, Essay, Global Risks Report, Public Risk, Safety.

Major Climate Report Describes a Strong Risk of Crisis as Early as 2040

By Coral Davenport | The New York Times.

UN mitigation targets

Written by redacteur on . Posted in 2018, Climate & Environment, Climate Change, Country, Economy, Public Risk, Report, Strategy.

Large potential reduction in economic damages under UN mitigation targets

Source: Nature

International climate change agreements typically specify global warming thresholds as policy targets, but the relative economic benefits of achieving these temperature targets remain poorly understood. Uncertainties include the spatial pattern of temperature change, how global and regional economic output will respond to these changes in temperature, and the willingness of  societies to trade present for future consumption. Here we combine historical evidence with national-level climate and socioeconomic projections to quantify the economic damages associated with the United Nations (UN) targets of 1.5 °C and 2 °C global warming,  and those associated with current UN national-level mitigation commitments (which together approach 3 °C warming).

Despite the Paris Agreement’s focus on the 1.5 °C and 2 °C targets, its actual Nationally Determined Contributions (NDCs) are instead consistent with 2.5–3 °C of global warming. We estimate that this level of warming could lead to a reduction in global GDP as high as 10% by mid-century and 15%–25% by the end of the century…
Read Letter

1979-1989: Climate change

Written by redacteur on . Posted in 2018, Advisory, Climate & Environment, Climate Change, Essay, Reliable and Secure Governance, Research, Safety.

Losing Earth: The Decade We Almost Stopped Climate Change

Source: The New York Times.

“This narrative by Nathaniel Rich is a work of history, addressing the 10-year period from 1979 to 1989: the decisive decade when humankind first came to a broad understanding of the causes and dangers of climate change. Complementing the text is a series of aerial photographs and videos, all shot over the past year by George Steinmetz.

With support from the Pulitzer Center, this two-part article is based on 18 months of reporting and well over a hundred interviews. It tracks the efforts of a small group of American scientists, activists and politicians to raise the alarm and stave off catastrophe. It will come as a revelation to many readers — an agonizing revelation — to understand how thoroughly they grasped the problem and how close they came to solving it. ” Jake Silverstein

Read more.

“Hothouse Earth” state

Written by redacteur on . Posted in 2018, Climate & Environment, Climate Change, Crisis & Disaster, Global Risks Report, Governance, Government, Reliable and Secure Governance, Research, Responsibility in High Dynamics, Safety.

Planet at risk of heading towards “Hothouse Earth” state

Stockholm Resilience Center.

An international team of scientists has published a study in Proceedings of the National Academy of Sciences (PNAS) showing that even if the carbon emission reductions called for in the Paris Agreement are met, there is a risk of Earth entering what the scientists call “Hothouse Earth” conditions.

A “Hothouse Earth” climate will in the long term stabilize at a global average of 4-5°C higher than pre-industrial temperatures with sea level 10-60 m higher than today, the paper says. Read more.

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