The financial impacts of climate change are coming

While the political farce over climate policy goes on, the Reserve Bank has been trying to work how best to protect our financial system from the ‘first order risk’ that is climate change.

Deputy governor of the Reserve Bank of Australia Guy Debelle (Image: AAP/Kelly Barnes)

“Words are not going to address climate change, actions are essential. To turn things around, we need policies and actions that lead to actual change and that are being implemented, rather than just being talked about.”

While the political class and its media enablers engage in more distraction and theatre on climate, the adults in the room at the Reserve Bank have been spelling out the nature of climate risks to the Australian financial system. In a speech yesterday, deputy RBA governor Guy Debelle specifically referred in his words above to companies engaging in greenwashing and the problem of verifying the green claims made for products. But they were perfectly applicable to the farce in Canberra.

Climate change isn’t just another risk, Debelle told an investment conference. “Climate change is a first-order risk for the financial system.” That’s even without the various financial policies that have been proposed by members of the government, such as removing the deposit guarantee from banks that refuse to fund coalmines or forcing Australians to pay higher interest rates so that sinister international financial forces don’t dictate policy to us.

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