New Zealand’s finance sector could soon reveal climate crisis risks – world first
New Zealand could be the first country in the world to require its financial sector to report every year on the impact of the climate crisis on their business.
The proposal was put forward by the country’s Green party and would become a reality if it once again formed a coalition government after this year’s election.
If passed by Parliament, about 200 of New Zealand’s largest financial organisations with assets totalling more than NZ$1 billion (£500m) would be required every year to disclose their climate crisis risks – the impact that extreme weather events and climate polices have on their business. They would also need to explain how they are managing them and if not, explain why not.
“Many large businesses in New Zealand do not currently have a good understanding of how climate change will impact what they do,” said minister for climate change James Shaw who announced the proposal.
“The changes I am announcing today will bring climate risks and resilience into the heart of financial and business decision making. It will ensure the disclosure of climate risk is clear, comprehensive and mainstream.”
“Australia, Canada, [the] UK, France, Japan, and the European Union are all working towards some form of climate risk reporting for companies,” he added. “But New Zealand is moving ahead of them by making disclosures about climate risk mandatory across the financial system.”
Joseph Stiglitz, a Nobel laureate in economics, praised the policy in a video statement supplied by Shaw’s office.
“Once again, New Zealand is leading the world … It led the world in showing how democratic countries could manage the risks of Covid-19,” he said. “And now, New Zealand is leading the way in showing how we can help manage the risk of climate change.”
Where you put your money matters. Many financial institutions are still propping up industries that are destroying the planet, even if they are aware of their own climate crisis risks. Find out if your bank is one of them by exploring the icons below.