Making Asia Pacific financial markets fit for climate change purpose
Author: Editorial Board, ANU
Natural capital is an essential input into all economic activities but, as the enormous consequences of climate change and environmental degradation attest, it’s rarely properly valued. Natural capital is the tolerable temperatures, breathable air, drinkable water, healthy land, and the complex ecosystems that maintain them. By undervaluing the role that natural capital plays in economic activities, markets underestimate the risks from environmental damage to growth and human welfare.
The devastating consequences of not properly pricing the cost of carbon emissions into the allocation of capital by financial markets are now a major global threat.
The United Nations Intergovernmental Panel on Climate Change (IPCC) Report last week was a huge wake-up call, especially to big polluters like China and the United States as well as climate-laggards like Australia…