Ch.3

Question 1

What is climate risk?

Answer 1

the financial risks linked to climate change

Question 2

What is the TCFD?

Answer 2

Taskforce on Climate-related Financial Disclosures

Question 3

What are physical risks?

Answer 3

risks that arise from the physical climate (and weather) impacts that result from the changing climate

Question 4

What are transition risks?

Answer 4

risks that arise from the economic transformation and any dislocation needed to drastically reduce, and eventually eliminate, net greenhouse gas emissions to reach net-zero emissions

Question 5

What are acute hazards?

Answer 5

weather-related or weather-exacerbated events, whose incidence are increasing with climate change, such as floods, hurricanes, droughts, and wildfires

Question 6

What are chronic hazards?

Answer 6

gradual, long-term trends such as rising average temperatures and sea levels

Question 7

Define exposure in a climate risk context

Answer 7

assets or firms that are in a vulnerable place or setting

Question 8

Define vulnerability in a climate risk context

Answer 8

the propensity or predisposition of the asset (or firm) to suffer adversely from its exposure to hazards

Question 9

Define stranded assets in a climate risk context

Answer 9

assets that have suffered from unanticipated or premature write-downs, devaluations or conversion to liabilities