Briefing Book
Climate Finance Briefing Book
July 23, 2024
Issue Area
Climate Finance
Overview
Climate finance refers to the financial pressures created by worsening climate‑driven weather events and how markets account for future climate risks in their planning. State governments have tremendous economic power that can be a force for shaping financial market outcomes in the face of climate change. State policymakers also have a range of tools and policies available that can shield constituents from the economic threats of climate change. Sectors including pension management, insurance, state contracts, and corporate disclosures lie uniquely under state control and can influence the resilience of state governments to climate-related financial shocks.
By building out climate finance frameworks, states can better anticipate financial risks, increase funding for climate mitigation and resilience projects, and strengthen overall economic stability in the coming decades.
Key Facts
Green banks are mission-driven institutions that use innovative financing to accelerate the clean energy transition and fight climate change. For every dollar of public capital invested, green banks successfully mobilize $3 to $7 from private sources.
In 2024, a study found that rising insurance premiums reduced home values by about $20,500 in the top 25% of homes most exposed to catastrophic hurricanes and wildfires, and by $43,900 in the top 10%.
States that have restricted the ability of companies to analyze investments through an environmental, social, and governance (ESG) lens have lost out on millions of dollars in public investment.
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