The Commonwealth Bank of Australia (CBA) has, in tandem with the Commonwealth Scientific and Industrial Research Organisation (CSIRO), announced a joint initiative aimed at identifying and mitigating the impact that climate change could have towards the finance sector.
According to the partners, the project will see CBA fund the research alongside anonymised data and information across a broad range of industries that are currently, or expected to soon be, affected by the climate crisis.
The scientific body will then utilise this data to develop sectoral analysis and different scenarios.
As per a statement provided by CBA, the CSIRO researchers will be focused on filling identified information gaps for the finance sector, such as determining the economic impact of climate change over geographic regions.
This research will then be overlayed with CBA’s economic and financial insights to “underscore the varying impact on the Australian economy”.
It’s said that the insights for this project will be publicly available.
Products developed through this project are also expected to become available on a digital platform currently being developed by CSIRO’s Climate Resilient Enterprise initiative.
CSIRO chief executive Dr Larry Marshall said that he believes initiatives such as this will provide Australia with a competitive advantage, building a stronger economy, workforce, and more resilient communities.
“CSIRO’s unique climate intelligence, supercharged by Australia’s largest data and AI network, and quantitative analytic capabilities can help financial institutions like Commonwealth Bank navigate an uncertain future,” Dr Marshall said.
“Australian businesses can lead our national response, especially when they have access to Australia’s world-class science and insights to guide meaningful, impactful investment in growth opportunities balanced by risk mitigation.”
CBA CEO Matt Comyn added that he felt this initiative would supplement the efforts currently being made by both financial institutions and communities to adapt to climate change.
“We believe our collaboration with CSIRO will better inform our approach on how to play a leadership role in supporting Australia’s transition to a more sustainable economy,” Mr Comyn said.
“The best scientific insight, combined with our data and insights, means CSIRO and CBA are well placed working together to help businesses understand what risks they face, how they can adapt and what opportunities are available to create jobs and investment in a lower carbon economy.”
The news of this initiative comes at a time of increasing environmentally geared products being provided by banks and lenders, as well as a growing consciousness of how a climate disaster may impact the financial services sector, including the property market.
In October, CBA announced it had approved a green loan worth $130 million for Australia’s “first build-to-rent development”, less than one month after it unveiled it had begun a pilot program to provide customers with personalised carbon footprints.
In September, the Reserve Bank of Australia (RBA) calculated that around 3.5 per cent of Australian dwellings were considered a “high-risk property” to climate-related damage.
The proportion of high-risk properties is expected to increase to 8 per cent over the next 80 years.