 Welcome to this session on the financial risks of climate change. My name is Katherine Hayhoe. I'm a climate scientist, chief scientist for the Nature Conservancy, and a professor at Texas Tech University. And with me, I have a panel of distinguished guests to help answer this key question. First of all, to set the stage, though, from the perspective of climate science. This last year, 2023, it not only broke planetary temperatures as the warmest year ever recorded, it also broke all kinds of other records. In terms of weather extremes. So, for example, heat waves. There were heat waves around the globe. There were heat waves in winter in South America. The waters off the coast of Florida and the U.S. were the temperatures of a hot tub. In my home country of Canada, the acreage burned by wildfire was almost five times the size of Switzerland. And that's not even counting the acres burned in Greece, the acres burned the Canary Islands, and elsewhere around the world. In one week alone in September, there were 12 record-breaking floods around the world, including the floods in Libya, which were responsible for thousands of deaths. And then, right after Climate Week in New York, a flood so severe that there was water bursting out of the subway walls in the New York metro system. We've also seen record droughts in South America and the Horn of Africa. All around the world, this was a year of weather extremes. And so often, when I speak of climate change, I don't call it global warming, because as individuals, we don't experience the average temperature of the planet. But what I do call it is global weirding, because wherever people live, they recognize that something is weird. You can talk to almost anyone, you can say, if you live here, do you feel the weather's weird? And they will say, yes. Scientists have predicted this. We've known for a long time that climate change is loading the weather dice against us. We've known that as the average temperature of the planet increases, heat waves will become more intense, the heat wave season will be extended, heavy downpours will become more frequent, and flood risk will increase in many places. The intensity of tropical storms, including cyclones, hurricanes, typhoons will increase. And droughts, like the one being experienced in Syria right now, which would not be a drought if it were not for human-induced warming, would become more intense. So this past year, we saw that insurance companies made news by pulling out of home insurance markets in several large U.S. states. That has raised concerns in the property market, as you can imagine, that it's overvalued by as much as $200 billion, and that's just in one country. Research in Australia suggested that one in 25 properties would be effectively uninsurable by 2030, due to rising risks of extreme weather. Equities may also be overpriced. A recent WEF research report showed that most companies need help understanding their exposure to physical climate risk, and many are not accounting for it adequately in their earnings projections. So with these impacts incurring unprecedented costs, what is the risk to the financial system as a whole, and how are decision-makers worldwide future-proofing it? To answer this question, we've brought together this panel. No pressure. It's a big question to answer. These experts represent a broad range of sectors, and we really need everyone on the stage, plus a few more sectors in addition to answer this question. So first of all, we have Inger Anderson, who's the Executive Director of the United Nations Environmental Program. Then we also have Christian Mumenthaler, who is the group CEO of Swiss Rea. Next, we have Mariana Mazucato, who's a professor at University College London and the author of Mission Economy, as well as several other books, which I have read. And then finally, we have Steven van Rijswijk, who's the CEO of Ing, and previously the Chief Risk Officer. So it was your full-time job to think about these issues. Indeed. So I want to start off the panel in a somewhat unusual way. The title of this panel was a question. Are the financial risks of climate change underestimated? And I would like each of our panelists to answer that question as it relates to their discipline. So from the environmental perspective, from the insurance perspective, from the economic perspective, and from the finance perspective, I would like them to answer that question with one word. I asked them ahead of time. And then follow that with one sentence of explanation. I know that's a tough challenge. Inger, you're up first. Yes. Yes, they are. And why? Why? Because everything that nature gives us is underpriced. Nature is underpriced itself and the services that it gives to us. The water supply that we have is underpriced and we don't look at overextraction from nature and therefore that risk exists. We're not looking at land degradation loss and what that does to our economies. And so therefore the entire system of nature and climate is part of that, obviously, is underpriced. And that is part and parcel of the conversation that we from UNEP are having with the broader world because we cannot continue to extract from nature or emit into nature, whichever way we look at it. The resources that nature provides to us and our toxic sludge from our existence into nature and assume that nature will continue on being in balance. So yes, it is absolutely underpriced. So we simply have not valued key aspects of things that are now coming back to cost us. Excellent. All right, Christian, are the risks over underestimated in your sector? No, but that's a different perspective. Exactly. Because I have to look at it in my sector. It's all about can we adequately predict the expected loss year on year and year. And as we can adapt the models, we have been able more or less, of course, in the best estimate to do that particular thing, which is estimate the risk correctly. And it's growing. And so that refers to that news that some insurers were pulling out of certain states because they were estimating the risk correctly is what you're saying. Yes. So they have reinsurers who estimate the risk and say we have clear evidence that some things become more expensive. The losses will go up. We charge that. And they want to pass it on to consumers, which they have to. And then in certain states, the reaction of consumers is they don't like it. So this is the first time we actually bring a climate change bill back to the consumer, if you think about it. It's sort of a carbon price, you could say. It's the result of us living the way we've been living results in costs that finally come back to the consumer. But of course they don't like it and the politicians don't like it. And so one of the reactions is, in California, for example, is the regulator not allowing the insurance companies to raise the rates, in which case they have no other choice than to withdraw. It's certainly not their preferred choice. Right. Interesting. All right, Mariana, from the perspective of the economy as a whole, I know you have the hardest question. Do you feel that in general the risks of climate change are underestimated? So... Well, one word and answer first, if possible. We are over pricing it. Because it depends, though, we're talking about price or cost, because the cost of inaction is so much greater than the cost of action. So the price to the global economy, but we also see it, as you said, in all these weird, weird effects, is much, much larger than not acting. And I could say much more, even though they didn't stick to the one sentence thing. So maybe I'll say an extra sentence. She had a lot of commas and semi-colons. Colon. Colon. Colon. Yeah. And the fact that there's actually plenty of finance out there, which is not going into this problem, means that also there's not a shortage of finance. We just have a massive financialization problem. We have global companies that have spent $7 trillion just in share buybacks. We have the gas and oil companies, by the way, which are leading that share buyback trend. But we also have, in the UK, where I live, for example, 80% of finance goes back to finance, insurance, and real estate. So this is a massive misdirection of finance in the financial sector, overly financialized corporate governance sector, and just a completely weirded out moment where we're not actually properly pricing the cost of inaction. But the Stern report proved that. It was also true in COVID. The cost of inaction was so much greater. The lockdown cost us a huge amount of money. Did we now, with all this money that's been created post-COVID, strengthen our global health systems? So next time we're more prepared? No. All right. Last but not least, Stefan. In your area, in financial areas, do you feel the risks are underestimated? Your comment initially was it, are they underpriced? Underpriced. And so it was underestimated is a state of mind. But underpriced is the factual truth, and they are underpriced. And the reason is that our loans and the pricing of our loans assumes known quantities in risk. And that is largely based on models. And these models, they look at risks that appeared in the past. And these models often have 10 years' data. When we look at climate risks, we don't have that data, or we have not captured that data. And so the sustainability risks are current and forward-looking risks. And they are not yet correctly priced in these models. So as a matter of principle, the risks of climate change are underpriced because they are forward-looking. And to give you one example, which is if we want to stick to net zero by 2050, and given the fact that we are currently already at 1.4, 1.48 degrees high, so closing in on the 1.5 already, if societies want to stick to that, that requires harsher policy response. And that is aberratic. I'm not saying it's wrong, aberratic, but that means that that needs then concurrent pricing, because that has a big impact on many sectors that's currently just on pricing. Well, I think that your answer really mirrors my perspective. So my perspective is very different as a scientist. Looking back at the paleo-climate history of the planet, we have never seen climate changing this quickly. We've never seen this much carbon going to the atmosphere. And as a result, temperatures changing faster than humans have ever observed during our very short civilization. And so by definition, we're looking at things we've never seen before. And so in that sense, how can we accurately price that, except by, as you said, in the reinsurance industry, going year by year and incorporating that new data? But we will always have a bias against the extremes because until we see them, how can we value them? So now I want to dig a little bit more into each of your areas of expertise. We've already had a taste, which is wonderful, but in here if I could start with you. So you're the leader of the United Nations Environmental Program and the top four global risks identified by WEF were environmental, so that underscores the importance of what you do. So you look at how climate impacts are manifested across people, across businesses, across nature. What gaps has UNEP identified and how are you confronting that challenge? So I guess that so far writ large to a large extent. The financial sector has begun to look at the climate risk. But I'd venture to say that there's much more in my space that the financial and beyond sectors need to look at because it impacts our very economies. Because we're beginning to, all that which prior was an externality, we're beginning to see oops, actually it's really impacting and where it's really impacting is of course where we're seeing it mostly right now by the sector is on climate. Good. But there are other elements and so I want to just highlight some of those. And it's a nerdy kind of word in our world, the science world, biodiversity, but it's just nature. It's just what nature does for you and it does everything. And the entire economy is based on nature, everything. The farming we do, the building and the extraction that we do, the cities we built, the products that we consume, everything comes from and it could be finite, a product that nature has produced like oil by sheer pressure over millennia, or it could be renewable, something that grows, we take it and we eat it or whatever we do. But nature produces it and we have had this assumption that there was an infinity of supply. The supply was just going to be there forever and that it was forgiving that we could just trash it, fragment it, introduce toxicity into it, move species around that have no business being on the same continent, so invasives and we could do and then suck it with climate change in a span of time that nature cannot adapt. And so all of that, of course, is causing risks that we do not know and that we cannot predict and that we cannot price, not in the economy, not in insurance. And that is something that we have to sort of be mindful of because this idea that rains will come and harvests will come and therefore the yield will be there and therefore my investments will have a return of this type. Not happening because of the wedding that you're talking about. And so when we then understand that it's about, I mean, what do you know? We say 58 trillion dollars of the world economy is dependent on the services of nature, et cetera. It doesn't really matter. It's a huge amount. Right? And we then speak about and the risk report, the 24 risk report, of course, highlights this, especially the 10-year span, because right now we have a lot of conflicts going on. And so that is an AI and other things, which obviously is grabbing the world's attention. But this thing upon which we all rely, that little thin layer that protects us from being a non-livable planet, all of that that we are destroying and then people say, okay, look 10 years out, big risk. And so in UNEP we speak about this triple planetary crisis. One piece of that crisis is a climate crisis. And people get that. The other piece is a nature loss crisis. I've spoken about that. The third piece is a pollution waste and chemicals. I mean, what we put in to the environment and how it toxifies us. And so dealing with that, then I think we will see and we are seeing parts of the world that will be uninsurable. We have said this for a long time. Because IPCC sits with us and so we see these models that takes us into the future and then we can obviously say that, no insurers are going to come here based on these models. That's just the reality. And we see on the sort of disruption of supply chain that we see ecosystem degradation really disrupting supply chain and obviously water insecurity and air pollution and water pollution and so on. So just to say that all of that has spurred us to lean into this area, we host, we have something that we call the UNEP Financial Initiative that has a large segment of banks as well as insurers that convene in a forum and asset holders and pension funds convene and sort of leaning into how they can move towards sustainability. And there we enable the creation of this task force on nature-related disclosures, very much modeling the task force on climate-related disclosures, which everybody understands and try to now follow, not everybody, but follow in terms of their disclosures. The task force, David Craig and my dear colleagues, Elizabeth Maruma Marama, have been leading the task force on nature-related disclosures. So really important and it was launched at the Stock Exchange in September of this year, a New York Stock Exchange. But because of what we are seeing, it's clear to us working with the banking, the global banking sector, being aware of what is needed, that we, UNEP, we could lean in more into this and that's why we are really happy to announce that we are rolling out a UNEP finance initiative, Risk Center, which we will launch in 2024 and which will address the climate as well as the nature, as well as the pollution, as well as other emerging environmental risks that we can see, because we do all the horizon watching. Exactly. And this is not their job. And so, but we actually do chemicals outlook. We, I mean, all of this stuff that we can tell, if we continue down this road, these things are likely to happen. So we hope that this will be something that we can offer up to the world as a useful piece that will offer a sort of unified approach that will enable also tools for development in various sectors and sub-sectors and provide some decision tools for resources. So that's really what we hope that we can offer because climate and environmental risks are very real, but are way underpriced and not, and way overlooked, underlooked. Overlooked. Underpriced, overlooked. That's the right English. Yes. So I think I hope that that would be useful to the world. Yes. That is very helpful to know about that. And as you can see, I mean, you could have a week-long conference on only the risks that you know studies and you'd just be scratching the surface. So someone's calling you there. In fact, someone wants that conference. And so, Christian, you've already touched lightly on how pricing risk is at the core of what you do. Climate change has really posed a new challenge for your industry, but it's a challenge that your industry has been looking at very intensely for over three decades. I remember back in the early 2000s, so well over 20 years ago, going to a meeting that Swiss Free and Others had put together with experts to talk about the climate risks. And as you said, you're doing very sophisticated pricing models that are already identifying the areas that Inger mentioned where it just isn't effective to offer insurance. So could you comment a little bit more on how you're pricing those risks and what you see coming in the next few years? Yep, okay. And I think it's important to make the link because Inger gave you the holistic picture and a lot of these elements are, we're not asked to insure. So we're in the very small world now of insurance and what is covered, which is natural catastrophe insurance firm, Homes, let's say, or industries. And what is also important to say is that we are not asked to cover it for 30 years at a fixed price. So the trend risk is not insured. It's a year-by-year assessment of the whole situation, which is much easier for us. And you're right, I think it was 1994, we published a whole publication around climate change, which did not interest anybody, to be honest. And then starting, I was also Chief Risk Officer at SIRS-3, and I started to talk at the WEF in 2005 and 2006 and very little interest in the topic of climate change. Just always the same few people. This has luckily changed the last few years but it has been a very slow start. So what are we doing? We have 45 experts who try to model the risk. You make physical models of hurricanes, the different pathways they could take, the vulnerability of the buildings, and we can see the risk change over a period of time, due to different factors, of course, because if you take Florida, for example, there's two, three times more people than there was in the 70s. And they build more expensive buildings at the front of the sea. So the value accumulation in a lot of these regions has been huge during that time. Building codes have become better, so that reduces, again, the risk. And then overlayed is climate change. And climate change extremely difficult. I mean, everybody who has been in modeling knows how difficult it is to model, and no model is correct. You just go directionally correct, they become better. But I think for anybody, it would be very difficult to predict what's going to happen in 10 years with droughts, for example. We can only look back at what we see is that certain perils like drought, flood, et cetera, have increased a lot statistically. And so we adapt the pricing models year by year, and we have always been maybe a year too late, but it's not so dramatic. We can cope with that. Whereas the base risk, if you want the trend risk, remains with society, because it's not a risk, it's a fact. And you don't ensure facts. Now, I get asked a lot about affordability, the topic we had before and what this means. And I guess it depends on your definition of affordability. If price goes up 30%, is this pricing people out or is it a question of money allocation to what they invest? I mean, do they buy something different or would they buy that? Technically, we can give a price for nearly everything. It's just that at some stage, if you're in a flood plain and every year there's a flood, the premium is 100% of your house because you have to pay the house once a year. So I guess if the frequency becomes too high, then it becomes impractical. But way before you start to have probably people really stressed from a financial point of view to be able to insure. But purely technically, we think we can approximate the correct price. That makes sense. And that's a very clear explanation. Thank you. Now, Mariana, so in your latest work, which is actually the title of your book, you propose the notion of a mission economy. I like short phrases like that, but I'd like to ask you to unpack it a little bit. So you suggest that there's all these different actors in the economy and governments, and they must all play a different role. So what does a mission economy look like when the mission is to adapt to climate risk, build resilient solutions, and ultimately to address all the challenges that we know exist, some of which we know we don't know yet about, but we know are coming. So what is a mission economy? How does it work? First of all, my latest book is actually about the consulting sector. Oh, I'm sorry. It's called The Big Con, how the consulting industry has infantilized our governments, weakened our businesses, and warped, made weird, our economies. And that's actually related. And that's a great title too, by the way. Yeah, we could look into the, you know, anyway, McKinsey and its relationship with climate and so on, but that's not what I'll talk about. So in mission economy, what I talk about is that when we actually treat problems as urgent, somehow, surprise, surprise, the money appears. Even just recently, think about the big debates, actually the paper is today, in Germany about, you know, the finance minister fighting with economics minister. Is there money? Are we, you know, should be we be worrying about the debt? And then when the Ukraine war happened, 100 billion was created overnight. So in war times, and just for wars in general, no one has ever asked, oh, there's no tax revenue. Sorry, we can't go to Vietnam. We can't, you know, fight World War II. We can't go to Afghanistan somehow, because we see it as a security risk, security problem, and an urgent one. You don't wait six months, six years, a decade to win a war. You want to win it right away. Not only is money created, but also all the tools that we have, all of a sudden become outcomes oriented. Right? So procurement, I'm obsessed. I'm a big nerd about procurement. Every government has this thing called public sector procurement purchasing. It's often between 30 and 40 percent of government budgets. You can either completely waste it or you can do what NASA did to go to the moon where they said, forget cost plus procurement. We're going to have fixed price, challenge orientation with incentives for innovation and improvement. It meant that 400,000 people worked with NASA in the private sector in sectors as different as nutrition, materials, electronics, software to solve all the different homework problems that were mission aligned. The mission was getting to the moon and back at a short amount of time, but they had to solve all these problems, including what the astronauts were wearing, what they were eating, the solutions got us camera phones, foil blankets, baby formula software, blah, blah, blah. Climate change A is not treated as urgent as it is when we want to go to war. It hasn't transformed all the different government instruments nationally, let alone multi-nationally. By that I mean procurement, grants, loans, all the different levers governments have could actually become conditional on creating an economy that's focused on the biggest problem of our time that you were talking about before. We could have, for example, public banks providing loans only if those sectors are, again, climate aligned. This happened, by the way, in Germany recently, where the KFW, which is the public bank in Germany, provided a loan to the steel sector only if it committed to reducing the material content of steel production, which they did. How they did it was up to them. If you micromanage business and tell them exactly what to do, that'll stifle innovation. But that idea of providing a strong direction and leaving open the how, but really making this an economy-wide transformation is possible. We just choose not to. And I think that's really important to talk about the choices, because, again, we know the numbers. There's plenty, whether it's UNEP or others who've shown that the cost of inaction on climate is so much greater than the cost of action, but that's not enough. Then we need to transform the everyday. And if you look at not just government instruments, but how business is done, you know, we have a corporate governance problem, and I was alluding to some of the figures, but when you have 7 trillion used for share buybacks, that's a massive amount of money that's not reinvested back into the economy, let alone when it's invested into the economy, making sure that the type of economy we have is inclusive and it's sustainable. And that comes to your point. I think it was you who raised the concept of externalities. That's just completely based on this wrong idea of how markets behave. It's not that you have a market and somehow that's the perfect way to set up a capitalist system and sometimes it messes up and the government should come in and fix a so-called market failure. That's how economists justify any type of public action, market failure fixing. That's why you need carbon taxes to fix negative externalities or funding public R&D to fix positive externalities. If you see the role of the public sector, it's just fixing a market failure. By design, you will always be reactive, not proactive. By design, you will be patching stuff up. And by design, you'll also be a bit depressed because at best you're de-risking the cool risk takers. So the whole narrative of markets being shaped, not fixed, they are shaped by collective action across business, across governments, increasingly also across philanthropies. I have a bit of a critique on philanthropies because I think they're often make, the money that's made from some of the largest philanthropies globally is based on bad business, which often doesn't pay tax, doesn't treat workers too well. I could go on and then the excess profits from a problematic business model are put into foundations that are called blah, blah, blah, earth fund or whatever it may be called. We need to change how, sorry, how business is done, how government is done, and how they work together treating this problem for all the reasons that climate scientists have been telling us for years is one of the most urgent problems of our time. And I don't like to talk about work as that's negative, but treating problems as urgently means putting the sustainable development goals at the center of how we do industrial strategy, innovation policy, and financial policy. Currently they're on the periphery. Well, funny that you mentioned banks because we have the person to pick that up and then speak about it. So, yeah, she knew we were sitting beside. So when it comes to banks, banks are crucial to incentivizing companies or de-incentivizing companies to take steps towards net zero, towards sustainability, towards understanding that we live on a round finite planet. So how is your bank working to help your clients assess and mitigate the risk and how are you helping to incentivize them to take actions that are towards a future that's better than the one we have today? Yeah. Yeah, we started in 2013. I was based on a speech of one of my colleagues who was a mathematician and making models, but he spoke about his youth and he saw the environment change. And that led to an enormous movement in the bank to start to talk to clients about climate change and how we could help. So we said, yeah, yeah, let's do that. But then quickly we said, what do we now talk about? So we had to educate ourselves. And then we went to many of our customers to talk about and at the time, I think 70% are making the number up of our clients that sustained what? And 20% yeah, we got this guy or girl. Yeah, come over. I and G, how I want to talk about this and maybe for five or 10% this was really boardroom talk. Now that is not the case anymore. So that is the good news. We have hundreds and hundreds and hundreds of people in ING focused on sustainability in their sectors. We're a big sector of finance here, especially for corporates. Let me talk about transition finance. Since we talked, I think that Christian talked largely about physical risk. And that's also important for banks, but a very big topic in banks is transition risk. How do we transition from a carbon intensive economy to a carbon extensive economy? Leaving biodiversity aside, which is even a bigger topic almost. So we do three main things. First of all, we educate and we have sustainability finance teams that educate on the risks for companies for climate change. And we have financial specialists that advise on how to finance or get sustainability loans and how to structure these loans. So we educate. The second thing we do is we finance. We finance two types of financing, if you will. First of all is behavior-based financing. ING was the first bank that helped Philips. It was the first bank that issued a sustainable loan. That was a loan linked to criteria that Philips had in 2017 to improve the CO2 intensity of its processes. And so we set targets of what they need to do. And if they then reach these targets, the interest rate goes down. So there's also financial benefit to it. And the second type of financing is use of proceeds financing. For example, a windmill park or batteries or sonar paddles or what have you. So that's the second topic. So financing. And the third topic is in the end, we developed an approach called Terra. What's in the name? And whereby we were based on the scientific approach of the IEA were able for our most climate-intensive sectors to measure what the intensity was of these sectors and how we could become in line in those sectors with Paris well and a half degrees. And so we started to measure very well, but we don't need to measure also. We also need to manage. And that's why we now have, and I'm actually quite proud of that as a next step, but this is not perfection overnight, but it's continuous adjustment. We now have thousands of climate plans of our clients in our system. So with each loan that we, so that that gives us two elements, two we can talk much better with our clients how they can transition to net zero themselves. But also we know much better with each loan that we do how in the CO2 footprint is impacted. And so therefore we have much more direct ways to steer. And let me give you this example, and the numbers are fictional. So let's say that from a CO2 intensity point of view for the automotive industry, you have to go from 100 in 2023 to 40 by 2030. And then you say, okay, if you do the linear lead, that needs to be minus 10 per annum, if that would be linear lead. I'm just making it up. But that also means that I can now say to the head of automotive in ING, okay, we are now at 100, choose as you like, but next year we're going to be at 90 because we can directly steer on these client plans. So education, financing, and discussing with our customers to directly steer on the climate impact that they're making. I think that's very powerful providing examples because we're asking people to do things that they've never done before, but providing examples is a way to help to incentivize that. So now I know if you're anything like me, you probably have things you want to say in response to what other people said. So I'm going to give you the opportunity to do that, but in order to hear from everybody, if you could keep your comments to one minute. Oh my God. One minute. So, Marianna, do you have something burning that you'd like to say? Well, just to support, I think it's fascinating what you said, but we should also remember there's the private banking industry, there's also a public banking industry which currently is not aligned. We have 22.2 trillion, that's 12 zeros, in the national development banks like BNDS in Brazil, 2.4 trillion in the MDBs, the Multilateral Development Banks, and they're not A aligned and they're not actually causing then also multiplier effect inside the private sector. So imagine if you had the regional public banks working closer with the national public banks around climate related missions and then those conditionalities like the ones I gave an example of with the KFW, any loan given to the private sector should be conditional on any sort of innovation, on processes, on anything that has to do with reducing the material content of production, net zero, so on and so forth. It would be immense and that's just the public financial sector, let alone what's happening in the private sector. Excellent point. Can I come in? Yeah, just to say, I mean, just back on the issue of, for the longest time, right, and this may be to what you were saying, Marianna, the goods, they all, i.e. what makes a profit, et cetera, has been in the private hand, but all the bads, that's the government problem. And so as long as that's the system, A, I mean, we're screwed, right? I mean, this is not going to work. It doesn't compute. So therefore, we need to have a conversation about that system and that system then needs to understand, therefore, that we need to see some transfers, we need to see some alignment, we need to have a system which does not just fix the bads, which they are and we are living them, but in fact, which proactively projects that this or that policy will need to be in place. And to enable that then, there is that broader global conversation that we will need to have in place. And then, but it's very, very hard because we have not understood that what science tells us has to, must lead to policy. Now on some things that are very, very dear to my heart, my health, okay, oops, we have understood. The science tells us that this thing is really going to kill us. Okay, we will have a policy. But that bigger thing that might very well kill us, it's on the too difficult list. Let's just stay with what we have. And this is that disconnection that we have as humans and then as a civilization, understanding the immediate, that which seems to be meeting my health, my child's health, the science tells me thus, I'm going to get the meds, right? But the bigger problem we're not solving. And I think the conversation therefore has to be one about holding to account. And it has to begin to a large extent and I want to pick up on the MDB and the public banks because this is the money of the taxpayer. And so there has to be an alignment I spent 15 years at the World Bank, did two vice-presidencies there and was always arguing that the bank has to be the green bank. It has to be that realigned bank. Thankfully now we have Adjei there and we can hope that some of that realignment may begin to happen. It's late, but it is very, very clear that the kind of investments I have the privilege of living in Nairobi and which is where the headquarters of UNEP is, that means that we're very close to a very real situation of poverty, energy poverty, inadequacy of investment, very highly priced investments, financing that is very difficult to catch. But of course, because the risk is high. The risk is priced high. So that's why we need to have the base load, the base level investment that has to be on the public purse to enable the private sector to come in. It is, we have to be very, very mindful, my last point here. That South Sudan is an oil producer. 7.9% access to modern electricity. Uganda, an oil producer. Tanzania, an oil producer. Mauritania, an oil producer. Ghana, an oil producer. Nigeria, with lots of issues, an oil producer. Those that I mentioned do have massive development problems. But nobody's going to invest in renewable energy. Is the message of the world to them keeping in the ground? It is, right? Would you, if you were the finance minister, the reality is that we need to have a global conversation about some shifts of resources, because otherwise this will not work. So the distance you mentioned is really interesting. It's what she was referring to is something called psychological distance. And it's a human tendency. It's just the way we're wired to view risks, especially risks that we feel that we cannot solve or address adequately, as distant from us in time and or in space and or in relevance, as well as being abstract rather than concrete. And when it comes to climate change, it takes every box. You ask people, are you worried? They say yes. Will it affect future generations? Yes. Will it affect plants and animals, non-human species? Yes. Will it even affect people who live over there? Yes. And then you ask people globally, will it affect you? The answer plummets. So in some ways I feel like the reinsurance industry is one of the only industries that really is not suffering from psychological distance. What thoughts do you have about that or about anything else that another panelist has said? I think this is very profound, because we tend to be a very rational industry because we have lots of actresses and physicists, etc. But that's not the normal average and normal people. And of course we pay every year if we do it wrong. But we have hired about 20 behavioral scientists and behavioral psychologists. And I think a lot of the issues we have in the world are linked to things we were not so aware of. We have all learned wrongly at school that humans are rational beings. And in reality we discover that extremely rarely are they rational beings. Most of the time they're not. And so I think we need to find ways to cope with that. And I think it's interesting when you think about government, companies and consumers who is going to help the most. Consumers make pressure, but I think they're the least willing to sacrifice anything. I mean that's really what I see in the world overall. Governments are willing only to go so far. They're very afraid about the reactions, etc. And you could see it again and again. So I see them very hesitant to even do some of the basic stuff, like a carbon tax that would be really helpful. At this stage, however, I'm quite optimistic about the actions in companies, much more than in the past. I think this comes from pressure actually from investors, from pension funds, that force a lot of CEOs to change their thinking. And now this is so broad that a huge majority of CEOs knows this transition is going to come anyway. It's going to come anyway. So it doesn't matter what you think, you have to adapt to it. And therefore we have our groups, even as part of it, of the CEO Climate Alliance. So we all have pledged net zero 2050, SBTI compatible where possible. We publish everything. And you can see over the last five years we have been co-chairing this group how the thinking of the CEOs have evolved from changing life bulbs to, okay, this is massively challenging, this whole transformation of my value chain. And the reason you have not heard yet so much about it is because a lot of people have been focused on their own, Scope 1 and 2. But this is now going to go into Scope 3. And then we have done a lot of work here. And this is now starting, which means basically upstream. So your suppliers, we have probably hundreds of thousands of suppliers, these 126 companies, they're very large. And so they're going to get the message that they have to be net zero 2050, small and medium companies. And we're going to support them with some technical help that we have put aside and so on. So I think you're going to see, we have to approach this from a government perspective, which is one dimension. And many governments have made some pledges and they go ahead. And then this is like a vertical because all of our companies were vertical across nearly all countries. And that's the other pressure point. So my hope is there's not much space to escape the transition between the two if we keep pushing on both sides. So, Stephen, you mentioned the transistor as well and your remarks. Do you agree with what Christian said about that CEOs feel like it's coming anyway, so now they have to adapt? Or do you feel like there's still some resistance? Well, first of all, I want to mention that they took nine minutes. So not so much. Oh, yeah. No, you've got the time of yours. I know, I know. So let me give you a short look, compared to what it was and that's why the analogy with the 2013 story was there, that the awareness and the action and the willingness is much more there and it's in the core of many company strategies. Still, I'm concerned because, indeed, for many of the biggest companies in the world, including our company and Christian's company, most of our missions are scope three and sometimes they're upstream and sometimes they're downstream. But let me give you one example, given time, so for us, as a bank, it's 99.9 percent. We have a couple of buildings, a data center, and some people traveling to clients. That's it. So 99.9 percent of our missions are scope three. Our clients, our lending. Let me give you one example, steel industry. The steel industry, do we need steel, right? If you have the most advocates of clients who say, well, we don't know we need steel, why, for cars. No, I say for windmills. Oh, yeah, yeah. No, we need steel for windmills. Absolutely. Okay, good. Do you know how steel is made? Yes. Well, how then? Well, by steel. No, by iron ore and you heat it and these ovens are cooking coal ovens, right? The most polluted fossil fuel there is. More than heating coal, more than lignite, more than oil and gas. Okay. Steel companies get to hydrogen ovens. Yeah, okay, but that's very expensive and if I'm the first one, I go bust. So you need policy intervention. You need sunset dates to say by 2000, I'm making it up 2035, no more coal ovens. Guys, now develop new ones and we'll subsidize all used public money, otherwise it will not happen. And that is, I'm very concerned with that. It was one minute. Yes, that was. All right, so we have a few seconds left and I'm going to take the moderator's prerogative to ask you one final question. I just want you to answer with a few words. When I say a few words, I mean five or less. Really. What do you want people to take away? There are people listening online. There's people here in this room. There's people who are going to be making decisions every day. So if you could just say in a few words as possible, what do you want people to take away about the issue of the risks of climate change? I have to be very careful because I spoke too long. Action and alignment. Action and alignment, thank you. I think we're moving, but it's too slow. We need to accelerate. Accelerate. Walk the talk of stakeholder value in terms of how public and private take mission seriously. Come together. Similar collaboration. Everybody has a role to play. Yes, and to that I would add it matters to us all. If you live on this planet, these risks affect you, your business, your bottom line. That means that each of us has a role to play. Thank you. Thank you. Thank you.