The goal of carbon peak by 2030 and carbon neutrality by 2060 has put forward new requirements for China's economic development mode: not only traditional industries need low-carbon transformation and energy conservation and emission reduction through technological optimization, but also advanced manufacturing and modern service industries need to be adjusted in the direction of digitization and greening, especially China's energy system is facing fundamental changes. At present, China's energy structure is dominated by coal. In the future, coal may become a regulatory energy, and renewable energy will occupy the mainstream.
In this context, the financial industry has ushered in new development opportunities. Achieving the "3060" goal is inseparable from technological upgrading, which faces a huge capital gap, which will be a huge development opportunity for all kinds of financial institutions, especially commercial banks. Taking the power industry as an example, with the gradual reduction of coal power, all links from power generation to transmission and then to power consumption need to be upgraded, and the energy storage technology will change accordingly. In the field of transportation, green transportation will become the mainstream. Railway electrification, road transportation electrification, sales of renewable energy electric vehicles and charging piles are important investment directions for the financial industry in the future.
Financial institutions need to actively innovate and develop financial products, strengthen climate risk management in investment and financing activities, and more actively help and promote various participants to achieve the "3060" goal. For example, issuing green loans, underwriting green bonds, setting up carbon funds, issuing low-carbon theme funds, etc. At the same time, financial institutions should also recognize that the proposal of the "3060" goal also poses new challenges to their own development. If financial institutions themselves cannot correctly recognize the relevant risks they face and actively practice green business, it will have a negative impact on future development.
For financial institutions, climate change will bring transformation risks: on the one hand, the transformation and upgrading of industries may turn current high-value investments into stranded assets; On the other hand, changes in the behavior of consumers, suppliers and other stakeholders and shareholders will also exacerbate the transformation risks faced by financial institutions. Therefore, it is very important for financial institutions to carry out environmental risk analysis, identification, assessment and management, and strengthen environmental information disclosure. Through the cognition and quantitative evaluation of relevant risks, we can effectively avoid relevant risks and reduce losses.
In the future, financial institutions need to develop tools and methodologies related to environmental risk management. For example, carry out environmental stress test to predict and evaluate the impact of environmental risks on the organization's finance, daily operation and strategic direction through scenario analysis, sensitivity analysis and other methods; Financial institutions also need to strengthen environmental information disclosure, timely disclose the environmental benefits brought by credit activities, as well as the carbon emission and intensity of asset portfolio, so as to meet the regulatory requirements and ensure the supervision of public opinion.
At this stage, the promotion and application of environmental risk analysis and management in financial institutions still face many difficulties, and the relevant capacity-building is still very lacking. In this regard, on the one hand, financial institutions can actively use advanced technical means such as blockchain and big data to improve their ability to process data and optimize models and methodologies in risk management activities. On the other hand, they can cooperate with industry associations, international organizations and academic institutions to strengthen their ability to carry out green finance practice through organizational training, talent training and other activities.
Published on August 19, 2021