The topic Greenhouse Gas at Swiss Re: business in a changing global climate

Man-made climate change, and the need to cut global greenhouse gas emissions, are universally acknowledged as posing various risks to business. In a carbon constrained imminent future, greenhouse gas emissions will become financial liabilities on many companies’ balance sheets. At the same time, carbon is becoming a tradable commodity, allowing companies to hedge their risks, profit from emissions assets and turn this new discipline into a competitive advantage.

Climate change is a major public concern. Worldwide, policy measures to stimulate reductions in greenhouse gas emissions are inevitable. From the emerging greenhouse gas regulation to the multitude of proposed US federal and state policies, as well as global NGO initiatives, the public and other stakeholders are exerting increasing pressure for concrete action. Many companies have taken up the challenge and are actively reducing their emissions footprint. But a long and demanding learning curve is still awaiting those many who will have to make greenhouse gas reduction considerations a part of their daily business practice.

Leading representatives of the financial community are starting to contribute to this process. From the rating of greenhouse gas-emitting companies to the financing of emission reduction projects and the insurance of greenhouse gas-related risks: financial institutions are considering the applicability of traditional financial instruments, while simultaneously developing new and innovative solutions. Early collaboration between the financial community and their industrial clients will be vital for the efficient transition towards decarbonised economic growth. Corporate responsibility, transparency and accountable activity are required to build trust in the business world’s ability to manage this issue of global magnitude.