The 2017 Atlantic hurricane season caused estimated damages of $265 billion. Given links between extreme weather and global warming, how close might we be to some companies or sectors being held liable, at least partially, due to their activities? The answer may be that this is closer than many expect.
Environmentally-focused investors often consider climate risks. Research suggests that share prices in carbon-intensive industries may not reflect potential liabilities for damages from extreme weather events. Investors concerned about the consequences of global warming may also be unaware that they can actively nudge companies away from destructive behaviors towards a more constructive role.
- Q G Rayer (2018), Extreme weather: towards pricing climate risk, DISCUS, available at http://discus.org.uk/extreme-weather-towards-pricing-climate-risk/, 4 pages, 6 December 2018.