WTW on what's impacting climate commitment

WTW on what's impacting climate commitment | Insurance Business Canada

WTW on what's impacting climate commitment

Vulnerability is a key driver of commitment to climate policy in the emerging world, while countries reliant on fossil-fuel income show the weakest commitment, new analysis by Oxford Analytica and WTW has revealed.

Of 62 nations and territories assessed in the WTW political risk index, Bangladesh, Malaysia, Chile, Senegal, and the Philippines were the most strongly committed to prioritising climate in public policy. They also ranked four on WTW’s one-to-five scale, where a bigger number connotes higher prioritisation of climate over other key policy objectives.

The remaining countries at most gave equal weight to combatting climate change and other key public policy goals.

WTW identified three factors correlating significantly with the relative commitment to climate policy of each country. These were vulnerability to climate change, state capacity or more effective civil service, and oil and gas income.

“Climate has always been a driver of political risk,” said Stuart Ashworth, managing director and head of political risk for corporates at WTW. “In extreme cases food and water are being weaponized for political reasons. Understanding a country’s vulnerability to climate shocks will be increasingly important for investors.”

Across world regions, African and Asian governments lead the emerging world on climate commitment. On a regional average basis, Asian countries tend to have strong policy-making practices and effective bureaucracies for carrying out political goals, with Malaysia and China as top examples with their well-developed climate transformation plans.

Expert ratings for many countries in Africa came in above statistical predictions, including Cameroon, Central African Republic, the DRC, Ethiopia, Morocco, Mozambique, Uganda, and top-rated Senegal. “The novel ‘green development’ approaches being pursued by many African countries could serve as a model for the rest of the world,” Sam Wilkin, director of political risk analytics at WTW, said.