Climate research on economic impacts

Climate change threatens to make a significant economic and social impact on our society. Those that will be affected notably are companies, the services they provide and the revenues they generate, basically the backbone of any economy. The effects of climate change are numerous. Climate research on economic impacts (C&E) aims to provide investors with the best, up-to-date research, in a company climate evaluation tool that judges businesses with respect to their climate awareness, mitigation potential and climate risk, pushing strong private sector emission reduction efforts and an increased climate resilience.

In the Pathfinder, the project partners PIK and Carbon Delta will evaluate and review how sophisticated research knowledge and data can be translated into monetary risk assessments for various economic sectors. The focus will be on how effects from global warming can be translated financially and how they drive growth. The dependency of the productivity on annual mean temperatures or how extreme weather events and sea level rise affect the monetary risks of companies (via damage functions) are examples of types of results that can be expected. In return these types of productivity and risk indicators offer the opportunity for innovation to get a better understanding of investor risks in greater detail. Quantifying the risks of climate change will raise its awareness and reduce the costs of damage. This has the potential to make available more climate-related investments in the financial sector.