Climate Change Scenarios and Financial Risk (22w5201)


John Thompson (UBCO)

(University of Western Ontario)

Joan Hu (Simon Fraser University)

(University of British Columbia - Okanagan)


The Banff International Research Station will host the "Climate Change Scenarios and Financial Risk" Online workshop at the UBC Okanagan campus in Kelowna, B.C., from July 3 to July 8, 2022.

It is generally accepted that the world's climate is undergoing rapid change. 
 With changes in temperature and precipitation patterns, regionally and globally, particular areas could
encounter longer periods of drought or sparse, but more intense rainfall events. Hence, substantial changes in agricultural
production are anticipated. For example, planting in spring could be delayed due to heavy rains, or a overly lengthy drought period
in summer could devastate a crop, and so on. Failure to produce over a sufficiently long period
will lead to financial failure of various forms, including credit default. The financial industry is
acutely aware of the potential for an increase in this form of credit risk, but there are currently only 
limited and insufficient ways of providing an assessment of the magnitude. 
 To help all financial market participants estimate climate related risks and opportunities, the Financial Stability Board established the Task Force on Climate-related Financial Disclosures (TFCD) in 2017. 
Core elements of a financial disclosure framework developed by this task force include strategizing around the actual and potential impacts of climate-related risks and opportunities on the organization's businesses, strategy, and financial planning; identifying, assessing, and managing climate-related risks; formulating metrics and targets to assess and manage relevant climate-related risks and opportunities. To implement these recommendations financial institutions require innovative methodologies and approaches to identify their climate related risks. The financial health of agriculture, forestry, fisheries, mining, tourism, and other economic sectors will be 
subject to climate-related shocks. This workshop provides a forum for experts in climate modelling, mathematical finance and
banking as well as researchers specializing in various economic sectors to discuss these issues and to identify 
ways in which new climate-related financial risk assessment tools may be developed.

The Banff International Research Station for Mathematical Innovation and Discovery (BIRS) is a collaborative Canada-US-Mexico venture that provides an environment for creative interaction as well as the exchange of ideas, knowledge, and methods within the Mathematical Sciences, with related disciplines and with industry. BIRS is supported by Canada's Natural Science and Engineering Research Council (NSERC), the U.S. National Science Foundation (NSF), Alberta's Advanced Education and Technology, and Mexico's Consejo Nacional de Ciencia y Tecnología (CONACYT).