AIGCC & CWR Joint Open Letter to APAC Banks to Stress Test Right for Rising Seas
by CWR 21 August, 2023
21st August, 2023 – The Asia Investor Group on Climate Change (AIGCC) and CWR have released an open letter urging the regions’ banks to overhaul their climate stress tests for escalating coastal threats. They say banks’ stress tests should be enhanced to keep up with the latest science on the Asia Pacific’s high and rising exposure to climate damage and disruption from sea level rise.
AIGCC represents investors with US$32 trillion AUM that are worried that without better stress testing banks and governments cannot see the real risks ahead. “Currently, over US$5 trillion (64%) of loan books of 17 APAC banks are at risk from rising seas. So, ignoring this chronic risk will impact financial stability”, said CWR’s Mirando.
For steps urged by AIGCC & CWR to improve stress tests – see the press release and access the open letter.
| “Current stress testing approaches often underestimate sea level rise risks because of a time frame that is too short, and the level of sea level rise used is too low. We hope that enhancing these assessments will lead to improved planning and greater resilience.” Eric Nietsch, Head of Sustainable Investing – Asia, Manulife Investment Management and Chair of AIGCC’s Physical Climate Risks and Resilience Working Group | “We are very pleased to see APAC investors with an AUM of US$32trillion actively engage on sea level rise with banks as it is an important risk that is often put on the back burner. Many don’t realise that we’ve already locked in 6-9m of rising seas and that the IPCC now warns that 2m “cannot be ruled out” by 2100.” Dharisha Mirando, Finance Engagement & Water Risk Valuation Lead – CWR, and Lead author of the report the recommendations are based on |
This investor action was catalysed by CWR’s report “Futureproofing APAC Banks & Savings: Stress test right today, avoid hard landing from rising seas”.
– Access the full report or see the media pack
– Don’t have the time? Check out the summary of the report & see how the report has instigated actions across C-Suite and risk heads for banks and corporates in “Gathering a Rising Tide”.
