Financial institutions often describe climate risk in terms of pricing. Can insurance premiums be adjusted? Can markets reprice assets? Can lenders charge appropriately for risk? These are important questions. They are not the most important question. The more consequential issue…
Climate risk is often discussed as a market phenomenon. It appears in pricing models, insurance premiums, asset valuations, and capital flows. In that framing, it is treated as something external to institutions: a force that acts on portfolios, markets, or…
Modern financial systems are structured around delegation. Risk is priced, transferred, insured, securitized, or hedged. Exposure is reallocated from operating entities to balance sheets designed to absorb it, from private actors to markets, and from markets to intermediaries. The underlying…
