This timely publication offers a cutting-edge analysis of the financial aspects of climate change. It discusses the most important analytical tools, their origin, how they work, where they can go, and how they fit into a larger strategy.

Mastering climate change has been recognised as a major challenge for the current decade. Besides the physical risks of climate change, the accompanying economic risks are substantial. Carbon Finance: A Risk Management View provides an in-depth analysis of how climate change will affect all aspects of financial markets and how mathematical and statistical methods can be used to analyse, model and manage the ensuing financial risks. There is a focus on the transition risk (termed carbon risk), but also a discussion of the impact of physical risks (as these risks are closely entangled) on the way to low carbon economies. This is a valuable overview for readers seeking an analysis of carbon risks from the perspective of financial risk management, utilising quantitative risk management tools.

Praise for Carbon Finance "A timely, objective, and informative analysis of the financial opportunities and challenges presented by climate change, including a thorough description of adaptive measures and insurance products for managing risk in a carbon constrained economy." —James R. Evans, M. Eng. P. Geo., Senior Manager, Environmental Risk Management, RBC Financial Group "Climate change will have enormous financial implications in the years to come. How businesses and investors respond to the risks and opportunities from this issue will have an enormous rippling effect in the global economy. Sonia Labatt and Rodney White's insights and thoughtful analysis should be read by all who want to successfully navigate this global business issue." —Andrea Moffat, Director, Corporate Programs, Ceres "In Carbon Finance, Labatt and White present a clear and accessible description of the climate change debate and the carbon market that is developing. Climate change is becoming an important factor for many financial sector participants. The authors illustrate how challenges and opportunities will arise within the carbon market for banking, insurance, and investment activities as well as for the regulated and energy sector of the economy." —Charles E. Kennedy, Director and Portfolio Manager, MacDougall, MacDougall & MacTier Inc. "Climate change is the greatest environmental challenge of our generation. Its impact on the energy sector has implications for productivity and competitiveness. At the same time, environmental risk has emerged as a major challenge for corporations in the age of full disclosure. Carbon Finance explains how these disparate forces have spawned a range of financial products designed to help manage the inherent risk. It is necessary reading for corporate executives facing challenges that are unique in their business experience." —Skip Willis, Managing Director Canadian Operations, ICF International "In this timely publication, Labatt and White succeed in communicating the workings of carbon markets, providing simple examples and invaluable context to the new and changing mechanisms that underpin our transformation to a carbon-constrained world. Carbon Finance will be the definitive guide to this field for years to come." —Susan McGeachie, Director, Innovest Strategic Value Advisors, Graduate Faculty Member, University of Toronto; and Jane Ambachtsheer, Principal, Mercer Investment Consulting, Graduate Faculty Member, University of Toronto

As the world plans for economic recovery following the global COVID-19 pandemic, major economies are looking to comprehensive strategies for addressing carbon risks and identifying green finance opportunities. Since Bank of England Governor Mark Carney and Michael Bloomberg began tackling climate change as a financial concern, the international financial community has been developing sophisticated analytical tools that will enable the success of comprehensive efforts to address carbon risks and identify green finance opportunities. This timely publication offers a cutting-edge analysis of the financial aspects of climate change. It discusses the most important analytical tools, their origin, how they work, where they can go, and how they fit into a larger strategy. First, reporting frameworks can allow companies to see how well they are addressing carbon risks, in particular with respect to the recommendations of the Task Force on Climate-related Financial Disclosures. Second, by quantifying how much greenhouse gas companies emit into the atmosphere as a direct or indirect result of their operations, carbon footprint calculations can help identify carbon risks with particular companies, especially within supply chains. Third, brown taxonomies can help investors identify current carbon risks by classifying fossil fuel assets in a systematic manner. Fourth, green taxonomies can help investors identify current green finance opportunities by classifying sustainable activities in a systematic manner. Fifth, scenario analysis for assets can help investors identify future carbon risks and green finance opportunities. Finally, stress testing for liabilities can help insurers and banks address future carbon risks and better inform policymakers. Scholars, policymakers, and business professionals will find this book informative. They will gain a comprehensive understanding of the analytical tools supporting efforts to address carbon risks and identify green finance opportunities. This will hopefully make these individuals more successful in their personal endeavors to build a more sustainable and resilient economy for future generations.

The book provides readers with essential insights into key issues in connection with planning, developing and financing sustainable energy projects in China that are relevant for practitioners, investors and developers involved in the emerging sustainable energy sector. It offers readers a deeper understanding of these contemporary issues by drawing on the lessons learned in real-world sustainable energy and green finance development activities in China, which are driven by central planning and policy implementation and complemented by investments and finances from public-private partnerships.

As drivers of climate action enter the fourth decade of what has become a multi-stage race, Net Zero has emerged as the dominant organizing principle. Hundreds of corporations and investors worldwide, together responsible for assets in the tens of trillions of dollars, are lining-up for the UN Race to Zero. This latest stage in the race to save civilization from heat, drought, fires, and floods, is defined by steering toward zeroing out greenhouse gas emissions by 2050. Settling Climate Accounts probes the practice of Net Zero finance. It elucidates both the state of play and a set of directions that help form judgements about whether Net Zero is going to carry climate action far enough. The book delves into technical analyses and activates the reader’s imagination with narrative accounts of climate action past, present, and future. Settling Climate Accounts is edited and authored by Stanford University faculty and researchers. The first part of the book investigates the rough edges of Net Zero in practice, exploring questions of hedging risk, Scope 3 emissions, greenwashing, and the business of asset management. The second half looks at states, markets, and transitions through the lenses of blended finance, offsets, debt, and securitization. The editors tease out possible solutions and raise further questions about the adequacy and reach of the Net Zero agenda. To effectively navigate the road ahead, the editors call out the need for accountability and ask: who is in charge of making Net Zero add up? Settling Climate Accounts offers context and foundation to ground the rapidly evolving practice of Net Zero finance. Targeted at seasoned practitioners, newly activated leaders, educators, and students of climate action the world over, this book embraces the complexity of climate action and, in so doing, proposes to animate and drive hope.

As the world plans for economic recovery following the global COVID-19 pandemic, major economies are looking to comprehensive strategies for addressing carbon risks and identifying green finance opportunities. Since Bank of England Governor Mark Carney and Michael Bloomberg began tackling climate change as a financial concern, the international financial community has been developing sophisticated analytical tools that will enable the success of comprehensive efforts to address carbon risks and identify green finance opportunities. This timely publication offers a cutting-edge analysis of the financial aspects of climate change. It discusses the most important analytical tools, their origin, how they work, where they can go, and how they fit into a larger strategy. First, reporting frameworks can allow companies to see how well they are addressing carbon risks, in particular with respect to the recommendations of the Task Force on Climate-related Financial Disclosures. Second, by quantifying how much greenhouse gas companies emit into the atmosphere as a direct or indirect result of their operations, carbon footprint calculations can help identify carbon risks with particular companies, especially within supply chains. Third, brown taxonomies can help investors identify current carbon risks by classifying fossil fuel assets in a systematic manner. Fourth, green taxonomies can help investors identify current green finance opportunities by classifying sustainable activities in a systematic manner. Fifth, scenario analysis for assets can help investors identify future carbon risks and green finance opportunities. Finally, stress testing for liabilities can help insurers and banks address future carbon risks and better inform policymakers. Scholars, policymakers, and business professionals will find this book informative. They will gain a comprehensive understanding of the analytical tools supporting efforts to address carbon risks and identify green finance opportunities. This will hopefully make these individuals more successful in their personal endeavors to build a more sustainable and resilient economy for future generations.