Firms ignoring climate crisis will go bankrupt, says Mark Carney

(The Guardian, 13 Oct 2019) Bank of England governor warns of financial collapse linked to climate emergency.

Companies and industries that are not moving towards zero-carbon emissions will be punished by investors and go bankrupt, the governor of the Bank of England has warned.

Mark Carney also told the Guardian it was possible that the global transition needed to tackle the climate crisis could result in an abrupt financial collapse. He said the longer action to reverse emissions was delayed, the more the risk of collapse would grow.

Carney has led efforts to address the dangers global heating poses to the financial sector, from increasing extreme weather disasters to a potential fall in asset values such as fossil fuel company valuations as government regulations bite. The Guardian revealed last week that just 20 fossil fuel companies have produced coal, oil and gas linked to more than a third of all emissions in the modern era.

The Bank of England has said up to $20tn (£16tn) of assets could be wiped out if the climate emergency is not addressed effectively. But Carney also said great fortunes could be made by those working to end greenhouse gas emissions with a big potential upside for the UK economy in particular.

In an interview with the Guardian, Carney said disclosure by companies of the risks posed by climate change to their business was key to a smooth transition to a zero-carbon world as it enabled investors to back winners.

“There will be industries, sectors and firms that do very well during this process because they will be part of the solution,” he said. “But there will also be ones that lag behind and they will be punished.”

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The Guardian, 13 Oct 2019: Firms ignoring climate crisis will go bankrupt, says Mark Carney