While there has been longstanding interest in how financial markets affect climate change, the effects of climate change on financial markets—particularly financial stability— have received comparatively little attention. The risk of climate change to financial stability is fast becoming too big to ignore. Cross-nationally, central banks are increasingly incorporating climate change—and its potential threats to financial stability—into their prudential agendas, while market regulators are beginning to explore various climate-driven risks. Banks, asset managers, and insurance companies are also beginning to recognize how climate change is affecting their bottom lines. Despite this increased general awareness, financial markets regulation and innovation to address climate risks are just beginning to emerge, creating an opportunity to collaboratively formulate effective regulatory and industry responses.
This one-day symposium will facilitate the development of a community of practice at Duke focused on this critical topic. Selected papers and materials presented at the symposium will be published in a special series on the Global Financial Markets Center’s “The FinReg Blog.”