In a recent keynote speech to the Insurance Council of Australia entitled 'Australia's New Horizon: Climate Change Challenges & Prudential Risk', Mr Geoff Summerhayes (Executive Board Member of APRA) stated:
Mr Summerhayes’ statement is the first by an Australian corporate or prudential regulator to clearly position climate change as a material financial risk. But whilst it may signal a significant shift in domestic prudential practice, in reality it merely more closely aligns our regulatory environment with that of other corporate or prudential regulators, treasuries and stock exchanges around the world.
For a number of years, MinterEllison has been at the forefront of thought leadership in this area and is unique amongst our commercial law peers in viewing the risks associated with climate change as a corporate and securities law (rather than ‘environmental’) issue. MinterEllison has extensively advised clients institutions from the Bank of England and European Union to the UNEP Financial Initiative across the financial services sector on integrating climate risk management into corporate governance and strategy. It is expertise that we would be pleased to share as you consider the practical implications of this shift in APRA policy for your organisation’s corporate governance and risk management.
The full transcript of Mr Summerhayes' speech is available here. You will also find below links to a selection of the Alerts that MinterEllison has published on corporate governance issues associated with climate risk in recent years.
We have also prepared a briefing paper on APRA's new approach to climate risk governance that you may find useful to circulate to your board and executives. We would be pleased to provide that briefing paper upon your request. Please do not hesitate to contact partner Maged Girgis (Sydney) on +61 2 9921 4410 or special counsel Sarah Barker (Melbourne) on +61 3 8608 2928, if we can assist.