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Shifting powers: Climate cooperation, chaos or competition?

Managing geopolitical risk from the climate transition

Climate diplomacy – the strategic cooperation or competition of states towards climate-related goals – is anticipated to drive global political developments in the coming century.

The global ambition – to reach net zero carbon emissions as early in the 21st Century as possible – is premised on the ability of states and civil society to define their collective environmental interests, before taking decisive action on the scale needed to address the challenge.

Insurers must monitor the changes in exposure and demand closely as the transition gains momentum and support businesses with the innovative insurance solutions that are needed to mitigate geopolitical risks around the climate challenge.

Shifting powers: Climate cooperation, chaos or competition?

Tuesday 18 January 2022

Shifting powers: Climate cooperation, chaos or competition?, helps insurers and risk managers navigate the significant overlap between geopolitical risks and climate change.Produced in partnership with the Cambridge Centre for Risk Studies, the report uses potential but plausible scenarios to guide insurers and risk owners through different possibilities of what the global energy transition might look like by the end of this decade, depending on the pathway major powers take in pursuing net zero by 2050. 

The three geopolitical scenarios explored are based on three broad assumptions of actors’ behaviour: Cooperation (I. Green Globalisation), chaos (II. Climate Anarchy), and competition (III. Green Cold War).