EFIV - Anticipating The Climate Change Risks For Sovereign Bonds: Part 2 - Insights On The Financial Impacts

• The huge economic transformation to achieve the Paris Agreement objectives is requiring a sizeable reallocation of assets. This assigns the financial sector a key role in tackling climate change.
• Regulators and international institutions require financial risks assessment of climate change. However, the practical methodology frameworks available are lacking.
• This paper, which is the second of a two-part study, explores the effects of climate change risks on sovereign bond returns and proposes an innovative and practical methodology that measures the anticipated costs from climate change.

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