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In his latest opinion piece, published on Medium, our Chief Policy Officer Peter Paul van de Wijs reflects on the growing acceptance that an understanding of impacts is a crucial step in assessing financial risk:
According to Peter Paul, disclosing corporate sustainability impacts is becoming essential to financial decision-making. Traditional reporting no longer fully captures the risks businesses face – and the reality is that most of a company’s impacts will, in time, become financially material.
Investors clinging to a traditional viewpoint may resist change but will ultimately be confronted by the consequences of global warming and end up with a portfolio of stranded assets, reputational damage and diminishing returns. Market participants are increasingly recognizing that measuring and disclosing financial risks in isolation is insufficient for navigating the complexities of today’s economic landscape.
Peter Paul van de Wijs