Climate change: Hong Kong firms must improve climate-risk assessments because of imminent threat to assets, incoming global standards, analytics firm says

Threat of climate change to assets is more imminent than many people think, says Entela Benz of climate modelling start-up Intensel

‘Physical losses are already happening,’ former UBS banker says

Reading Time:3 minutes

Broken office windows at One Harbourfront in Hong Kong’s Hung Hom district after Typhoon Mangkhut struck the city in September 2018. Photo: Dickson Lee

Published: 2:00pm, 5 May 2023

Hong Kong companies should conduct a thorough assessment of their assets and operations’ exposure to climate-change risks, even if the city’s financial markets are yet to price them in, according to an analytics provider.

This is important because the threat of climate change to assets is more imminent than many people think, said Entela Benz, founder and CEO of big data and artificial intelligence-enhanced climate modelling technology start-up Intensel.

Corporate climate resilience data disclosures will be stepped up globally in the next few years, with such disclosures required under the proposed standards of the International Sustainability Standards Board, which are to be finalised by June 30.

“People think the impact will only come in the longer term, like decades away,” Benz said in an interview. “But physical losses are already happening, and the market is starting to price in this risk.

Benz, Intensel’s founder and CEO, is also an adjunct associate professor of finance at the Hong Kong University of Science and Technology. Photo: Xiaomei Chen

“Even if we succeeded in mitigating climate risks so that global warming is contained within 1.5 degrees Celsius, which is highly unlikely, the impact from the warming is already locked in … so we need to [adapt and take] action now.”

Select Voice

Choose your listening speed

Get through articles 2x faster

1.25x

250 WPM

Slow

Average

Fast

00:0000:00

1.25x