Hurricanes add urgency to efforts to make climate resilience investable (podcast)



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We’re only beginning to tally the devastation from hurricanes Harvey, Irma and now Maria — and the wildfires in the Western U.S. and the monsoons in Bangladesh and the floods in Nigeria and across South Asia. Climate change is increasing the size, and intensity and cost of these natural disasters.

How can impact investors help build an economy more resilient to climate change, asks Brian Walsh, head of impact for fintech firm Liquidnet, to kick off the latest episode of ImpactAlpha’s Returns on Investment podcast.

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The risk of not doing anything is rising, says David Bank, ImpactAlpha’s editor and CEO. “Mitigating those risks then presents all sorts of opportunities for financing solutions.” Reef insurance, forest resilience bonds, and mechanisms to help residents finance stronger roofs and other financial instruments can defray costs, transfer risks and build needed infrastructure for coastal communities and others that suffering these consequences.

Climate politics

Impact investors shouldn’t shy from advocating for a political response to climate change, says Imogen Rose-Smith, now an investment fellow with the University of California’s investment office. Rose-Smith spent 12 years as a writer for Institutional Investor before joining UC’s investment team in August where she’ll advise the university’s sustainable investments.

The risk, says Rose-Smith, is that impact capital is seen as the capital that steps into the void and tries to make things better. “What we really need to do is to steer the entire capital market system and the entire political system into a more resilient approach.”

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For political avenues, look to the Sustainable Development Goals, adds Bank. Climate change-accelerated disasters have the potential to undermine nearly all the goals. “Putting these things on a policy agenda can be very effective in creating the mechanism where communities and cities and countries can finance that resilience,” says Bank. That financing is huge and “it has to have private capital involved.”

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More on climate-resiliency investments called out by the roundtable:

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