• Latest
Climate Change

The Next Big Financial Crisis Could Be Triggered By Climate Change

November 19, 2021
Remote Teams

How to Boost Productivity in Remote Teams

September 8, 2023
How You Can Support Your Employees

How You Can Support Your Employees Better This Winter

September 8, 2023
DoMyEssay Reviews

Pros, Cons, and Final Ratings: Your Complete DoMyEssay Review

September 7, 2023
EssayService.com Review

EssayService.com Review: The All-in-One Platform for Your Academic Needs

September 7, 2023
Pyramid Principle

How to Structure Your Essay Using the Pyramid Principle

September 7, 2023
Laptop's Battery Life

10 Tips Every Student Should Know For Maximizing Your Laptop’s Battery Life

September 6, 2023
Flight Delays

Flight Delays: What to Do and How to Prevent Them

September 5, 2023
Free Small Business Accounting Software

Boost Efficiency with Free Small Business Accounting Software – Top 5 Picks and Reviews

September 4, 2023
Guest Experience

Guest Experience Strategies to Give Your Hotel a Competitive Advantage

August 29, 2023
Healthcare Business

8 Tips for a Flourishing Healthcare Business

August 29, 2023
Backlinks

Why Do Backlinks in SEO Always Matter?

August 28, 2023
Accounting Software

Integrating Small Business Accounting Software with Other Essential Tools and Systems

August 25, 2023
  • About Us
  • Contact Us
  • Write for Us
  • Privacy Policy
Friday, September 22, 2023
Business2News
  • News
  • Business
    • Small Business
    • Global Business
    • Entrepreneur
  • Finance
  • Technology
    • Digital Marketing
    • Social Media Marketing
    • Tech Brands
    • Gadgets
    • Gaming
    • Reviews
  • Health
  • Fashion
  • Traveling
  • Education & Job
  • More
    • Cars & Bikes
    • Sports
    • DIY Home
    • Entertainment
    • Food
No Result
View All Result
  • News
  • Business
    • Small Business
    • Global Business
    • Entrepreneur
  • Finance
  • Technology
    • Digital Marketing
    • Social Media Marketing
    • Tech Brands
    • Gadgets
    • Gaming
    • Reviews
  • Health
  • Fashion
  • Traveling
  • Education & Job
  • More
    • Cars & Bikes
    • Sports
    • DIY Home
    • Entertainment
    • Food
No Result
View All Result
Business2News
No Result
View All Result
Home Finance

The Next Big Financial Crisis Could Be Triggered By Climate Change

Editor by Editor
November 19, 2021
in Finance
0
Climate Change

The year 2008 still lingers in the minds of many US citizens, especially investors who witnessed the worst financial crisis ever recorded. More than a decade later, the world’s economy is under threat, and this time, climate change is the force behind it. The magnitude of its impact will once again rely on the measures taken by central banks and other financial regulators. Many companies and organizations have come forth to sensitize the masses about the threat that climate change poses.

Big companies such as Microsoft and Tesla have played a significant role in ensuring they limit their carbon footprint and also provide financial assistance to regions experiencing drastic climate change. Companies in the gaming and gambling niche also contribute to the greater course by sensitizing large masses through video games. For example, in 2019, major video game companies formed the Playing For The Planet Alliance.  The alliance was aimed at helping address climate change through ‘green nudges’ in-game designs.

On the other hand, casinos are contributing to climate change because of the sheer amount of energy it takes in electricity, especially lighting and slot games. For example, most casinos in India are located on ships that consume huge amounts of energy. Indian gamblers, on the other hand, can reduce their carbon impact by using online casinos.At the same time, gamers may still play a wide variety of casino games, including live dealer casino gameslike live poker, teen patti, and baccarat, and get the same experience for free or with real money.

Table of Contents

  • An Overview of Impact of Climate Change on the Financial Sector
  • Climate-Stress-Testing Banks
  • Monetary and Financial Policy Solutions

An Overview of Impact of Climate Change on the Financial Sector

The impact of climate change can be looked at from various dimensions, and as such, the potential risk is not always obvious. In 2015, the governor of the Bank of England, Mark Carney, identified some crucial risks associated with climate change, all potentially sabotaging financial systems. These risks include the rising cost of extreme weather, the high numbers of lawsuits against companies that have contributed to climate change, and the falling value of fossil fuel assets.

A US economist, Joseph Stiglitz, recently commented that the sudden rise in carbon price due to the levies imposed by the government on companies could trigger a financial crisis. He notes that the fossil fuel industry will be the first to experience the shock and will spill over on the financial institutions that support them. This impact will then spread to the broader economy.

Climate-Stress-Testing Banks

The primary strategy that regulators should deploy is to compel banks to disclose the risks they face from climate change. They can further stress-test their capacity on whether they can independently manage change. In the US, President Biden released an executive order requiring that US companies assess their exposure to climate change and provide outlines on how they will cope with future policies.

The UK has already made significant steps towards the management of climate change. Major companies are obligated to release their carbon footprints. The UK government also has an elaborate plan to include all industries. In the EU, before any company undertakes an investment decision, the law states that it should submit a climate and sustainability report to the European Commission.

Monetary and Financial Policy Solutions

The fight against climate change is a collaborative effort involving many stakeholders. The front runners include academics and central banks that have designed financial regulation strategies and monetary policies. The first policy is green quantitative easing which is similar to quantitative easing deployed to manage the financial crisis in 2008. It means that the central bank acquires financial assets to increase the supply of money in the economy.

Another viable policy is to revise the banking regulations to acknowledge the dangers banks face regarding climate change. Central banks have capped the capital requirements for banks to improve stability in the financial sector. Each institution has a minimum amount of liquid capital that allows it to advance credit.

On the other hand, central banks should consider incorporating environmental factors in the capital requirements to protect the banks from financial risks associated with climate change. A specific example is banks giving loans to carbon-intensive companies who will be subjected to higher capital requirements to discourage them from advancing credit to such firms.

Tags: Financial CrisisFinancial PolicyMonetary Policy
No Result
View All Result

Most Popular

Girl with Dimples

10 Reasons Why You Should Marry a Girl with Dimples

February 11, 2023
p2p4u

12 Best p2p4u Alternatives Sites to Watch Online Sports for Free in HD Quality

July 7, 2023
Children’s Education

Dr Lola Tillyaeva’s charitable work in Uzbekistan showcases the importance of philanthropy for children’s education and healthcare in Central Asia post-Covid

March 31, 2022
Top Cartoons of the 50s and 70s

Top 10 Cartoons of the 50s and 70s – Famous Cartoons

July 6, 2023
scph7502

scph7502.bin Bios Files the Best Bios Files Nowadays

March 1, 2023
HDonline and Its Alternatives

Top 24 Websites Like HDonline and Its Alternatives 2023

February 23, 2023
Load More

Navigate Site

  • About Us
  • Contact Us
  • Write for Us
  • Privacy Policy

Brilliantly

SAFE!

business2news.com

Content & Links

Verified by Sur.ly

2022
No Result
View All Result
  • News
  • Business
    • Small Business
    • Global Business
    • Entrepreneur
  • Finance
  • Technology
    • Digital Marketing
    • Social Media Marketing
    • Tech Brands
    • Gadgets
    • Gaming
    • Reviews
  • Health
  • Fashion
  • Traveling
  • Education & Job
  • More
    • Cars & Bikes
    • Sports
    • DIY Home
    • Entertainment
    • Food

© 2021- Business2news.

We use cookies on our website to give you the most relevant experience by remembering your preferences and repeat visits. By clicking “Accept”, you consent to the use of ALL the cookies.
Cookie settingsACCEPT
Manage consent

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. These cookies ensure basic functionalities and security features of the website, anonymously.
CookieDurationDescription
cookielawinfo-checbox-analytics11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".
cookielawinfo-checbox-functional11 monthsThe cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
cookielawinfo-checbox-others11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.
cookielawinfo-checkbox-necessary11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".
cookielawinfo-checkbox-performance11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".
viewed_cookie_policy11 monthsThe cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data.
Functional
Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
Performance
Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Analytics
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
Advertisement
Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.
Others
Other uncategorized cookies are those that are being analyzed and have not been classified into a category as yet.
SAVE & ACCEPT