The mandate of the Clean Energy Finance Corporation (CEFC) should be expanded to allow the green bank to spur private capital investment in climate change resilience projects as part of reforms recommended by the Investor Group on Climate Change (IGCC) in its submission to the Royal Commission into National Natural Disaster Arrangements.
IGCC, which represents institutional investors with over $2 trillion in assets under management, warned in its submission that failure by Australian governments to plan today for future damage from climate change will increase economic risks, costs and impacts across the community.
To better prepare communities and the financial sector for the unavoidable impact of climate change, the submission recommends, among other measures, that governments:
- Extend the mandate of the CEFC and bolster its budget to help co-fund resilience and adaptation projects. Financing options that could be considered include pooling smaller projects to attract private sector co-investment and resilience bonds.
- Implement mandatory reporting of climate-related financial disclosures to stop the underreporting of climate change exposure by companies and ensure investors can make full risk assessments and better price risk.
- Conduct a national assessment of the infrastructure at risk from climate change and begin mapping out an adaptation roadmap including the indicative investment need.
- Revise the National Construction Code to explicitly account for climate change threats.
- Establish a National Climate Services Capability to better coordinate the provision of climate data between the Bureau of Meteorology, CSIRO, academia and other private and public sector actors.