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Sustainability 2018, 10(1), 13; doi:10.3390/su10010013

Innovative Corporate Initiatives to Reduce Climate Risk: Lessons from East Asia

Department of Economics, Colorado State University, Fort Collins, CO 80523-1771, USA
Author to whom correspondence should be addressed.
Received: 31 October 2017 / Revised: 17 December 2017 / Accepted: 19 December 2017 / Published: 21 December 2017
(This article belongs to the Special Issue Climate Change Adaptation, Mitigation and Development)
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Businesses, investors, and insurers are requiring better quantitative assessments of their exposure to climate risks and their impact on climate change. They are incorporating these assessments in their day-to-day management and long-term investment decisions. Already, there are efforts to develop international guidelines, common policies and legal frameworks for such assessments, as well as the desire to foster climate financing. We examine recent progress in East Asia and the rest of the world in setting targets, pricing policies, and other mechanisms to reduce climate risks. We develop a model that demonstrates how reduced climate risk management may lower the total cost of capital of firms, thus making them more attractive to investors. We discuss the additional policies needed to support improved climate risk management in investment decisions, private investments in climate science, technology and innovation (STI) expansion, and more widespread adoption of climate financing and principles. Central banks, financial authorities, and governments can advance this objective by creating financial incentives to support investment decision-making. This would take into account factors such as improving climate performance, establishing better climate risk management and reporting requirements to foster green STI, and developing international guidelines and common policy and legal frameworks to support better climate risk management, assessments and reporting. View Full-Text
Keywords: climate risk; corporate initiatives; climate finance; green science; technology and innovation (STI); East Asia climate risk; corporate initiatives; climate finance; green science; technology and innovation (STI); East Asia

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This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. (CC BY 4.0).

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Barbier, E.B.; Burgess, J.C. Innovative Corporate Initiatives to Reduce Climate Risk: Lessons from East Asia. Sustainability 2018, 10, 13.

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