4.6 - Transition Risks

Question 1

Transition risks

Answer 1

Which relate to social and economic shifts to a low-carbon economy

Question 2

What is the first specific transition risk that may arise in relation to climate change?

Answer 2

Risk of the business not complying with climate change regulation, which could lead to fines, loss of licenses or being forced to close

Question 3

What is the second specific transition risk that may arise in relation to climate change?

Answer 3

Risk that a business loses major investors if it is not prepared to manage climate-related risks and seize associated opportunities

Question 4

What is the third specific transition risk that may arise in relation to climate change?

Answer 4

Risk that traditional business is unable to adapt e.g car manufacturer not moving to electric vehicles