How spatial finance can boost the climate change fight through better environmental predictions

Spatial finance can improve the quality of predictions about the impact of climate change, allowing a more accurate assessment of environmental risks

Improved evidence and monitoring will make it practical for investors and creditors to detect breaches of biodiversity covenants and enforce compliance

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Los Angeles County firefighters keep watch on the Bobcat Fire as it burns through the night in Juniper Hills, California, on September 19. Spatial finance can improve the quality of predictions about the impact of climate change, allowing the financial sector to conduct a more accurate assessment of environmental risks. Photo: Reuters

Published: 4:15pm, 21 Oct 2020Updated: 10:26pm, 21 Oct 2020

While the Covid-19 pandemic might be, in itself, the product of human interference with nature, it is not the only grave challenge society faces today. The environment is severely affected by man-made climate change, resulting in loss of biodiversity and emerging shortages in food production and availability of fresh water.

The UN Sustainable Development Goals, alongside the Paris Agreement on climate change, form the core of global strategies to promote sustainable development and social growth over time. Achieving sustainability requires vast sums to be invested in the green economy, and sustainable finance in the form of investing directly and through financial-sector lending and insurance has become critical.

Sustainable finance extends to such products and initiatives as green bonds and corporate investment that seek to promote societal and sustainability impacts. How can we identify and verify such impacts? This is an important question both in economic and legal terms.