Chart of the WeekFirms’ Environmental Performance in Times of Crisis

2020-10-27T16:58:35-04:00October 26, 2020|

By Pierre Guérin, Fabio Natalucci, Felix Suntheim

عربي, 中文, Español, Français, 日本語, Português, Русский 

Leaders are often called upon to “rise to the challenge” in times of crisis. As firms and their leaders rise as best they can amid the ongoing health and economic crises, yet another crisis lies on the horizon. A looming environmental crisis, obscured by the exigency of the pandemic, requires action be taken by firms (and others). So how will business leaders and companies respond?

Our latest analysis looks at past episodes of financial and economic stress to gauge the likely impact of the current crisis on firms’ environmental performance.

On the one hand, the COVID-19 pandemic could increase awareness of environmental risks and bring about a shift in consumer preferences, corporate actions, and investor behavior that could accelerate the transition to a low-carbon economy. On the other hand, there is a risk that financially weakened firms, amidst heightened economic uncertainty, will reduce their investments in long-horizon, capital-intensive green projects, slowing down the transition.

Past as predictor

Looking at a large international sample of listed firms over the period 2002 to 2019, our analysis shows that the environmental performance of financially constrained firms is […]

Finding the Right Policy Mix to Safeguard our Climate

2020-10-07T13:05:48-04:00October 7, 2020|

By IMF Staff

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Unaddressed, climate change will entail a potentially catastrophic human and economic toll, but it’s not too late to change course.

Global temperatures have increased by about 1°C since the pre-industrial era because of heat-trapping green-house gases accumulating in the atmosphere. Unless strong action is taken to curb emissions of these gases, global temperatures could increase by an additional 2–5°C by the end of this century. Keeping temperatures to levels deemed safe by scientists requires bringing net carbon emissions to zero on net globally by mid-century.

…economic policy tools can pave a road toward net zero emissions by 2050 even as the world seeks to recover from the COVID-19 crisis.

In the latest World Economic Outlook we make the case that economic policy tools can pave a road toward net zero emissions by 2050 even as the world seeks to recover from the COVID-19 crisis. We show that these policies can be pursued in a manner that supports economic growth, employment and income equality.

The manageable costs of mitigation

Economic policies can help address climate change through two main channels: by affecting the composition […]

How to Meet the European Union’s Ambitious Climate Mitigation Goals

2020-09-25T17:18:12-04:00September 24, 2020|

By Dora Iakova, Alfred Kammer, and James Roaf

عربي, 中文, Español, Français, 日本語, Português, Русский 

Last week, the President of the European Commission Ursula von der Leyen made an ambitious proposal. By 2030, the European Union would aim to reduce greenhouse gas emissions by at least 55 percent below their 1990 levels. And this is just an intermediate target. The final goal is for the EU to become climate neutral by 2050, as stated in the European Green Deal. […]

A New Climate Economy

2019-11-27T09:58:43-05:00November 26, 2019|

By Gita Bhatt

“Everybody talks about the weather, but nobody does anything about it.” The quip, attributed to 19th-century American humorist Mark Twain, might describe the current state of play on climate change. In Twain’s day, it was absurd to suppose humans could do anything about the weather. […]

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