Climate Finance Risk And Governance

Climate Finance, Risk, and Governance

Explores the intersection of environmental sustainability, economic policy, and legal frameworks.

European Investment Bank

Greening the financial sector

Matteo Ferrazzi

International Monetary Fund

Banking Law and Climate Change: Key Legal Issues

Alessandro Gullo

University of Stirling

Human rights and the impacts of climate change

Annalisa Savaresi

ABN AMRO

Climate change and the Dutch housing market

Sandra Phlippen

New York University

Sustainable Finance

Rodrigo Zeidan

Overview

Climate Finance, Risk, and Governance sits at the critical nexus of environmental sustainability, economic stability, and legal transformation. This theme investigates how financial systems are adapting to climate change, the legal tools guiding this transition, and the governance mechanisms required to ensure equity, resilience, and accountability. This area is no longer peripheral — it is now core to central bank mandates, institutional investment strategies, housing policy, and international development finance. As environmental risks materialize economically and socially, professionals across finance, law, and public policy must engage with climate-aligned governance as both a compliance obligation and a strategic opportunity.

Why It Matters

Systemic Financial Risk: Climate change exposes banks and markets to physical and transition risks that threaten global financial stability.
Legal Transformation: Courts and legislators are increasingly recognizing environmental obligations within human rights, corporate duty of care, and fiduciary standards.
Capital Allocation: Investment strategies are being rewired toward green assets, ESG criteria, and sustainable finance frameworks.
Public Mandates: Governments and institutions are leveraging finance as a policy lever for climate action — reshaping credit, tax, and subsidy systems.

Core Concepts

Greening Financial Institutions

Contributors: European Investment Bank & Sandra Phlippen (ABN AMRO)

How banks shift capital toward low-carbon sectors.
The systemic consequences of mispriced climate risk in mortgage and housing markets.

Legal Foundations of Climate Responsibility

Contributors: Alessandro Gullo (IMF) & Annalisa Savaresi (Stirling)

Banking law and the role of regulators in enforcing climate disclosure.
The intersection of climate harm with human rights obligations.

Sustainable Capital Markets

Contributors: Rodrigo Zeidan (NYU)

ESG investing, green bonds, and the debate over sustainable profitability.
Risks of greenwashing and the need for standardization in disclosures.

Key Questions

Strategic

How can financial institutions become catalysts for systemic decarbonization?
What are the risks of delayed adaptation in financial regulation?

Legal & Ethical

How is climate change redefining fiduciary duty, human rights, and corporate liability?
What legal tools can hold financial actors accountable for climate risk?

Operational & Policy

How can housing and mortgage markets be better aligned with climate goals?
What governance models ensure transparency, equity, and accountability in climate finance?

Philosophical & Global

Should finance serve as an enforcer of climate ethics?
How can global institutions reconcile climate justice with economic growth?

Suggested Use

For Practitioners

Use this guide to initiate cross-departmental workshops or integrate climate risk into internal risk frameworks.

For Academics

Frame classroom discussion around interdisciplinary implications — law, finance, public policy, and environmental science.

For Policymakers

Structure policy briefings around capital flow diagnostics, legal reform, and public-private partnerships for climate resilience.