Actuaries must take climate change more seriously

I was saddened by Keith Satchell and Adrian Waddingham’s letter (‘IFoA’s recent climate paper is too strident’, The Actuary, May/June).

Thanks to systems thinking, we know that societal risk and financial risk are different paradigms. We often treat them as interchangeable but their differences have major implications. Modern portfolio theory does not work so well, stewardship is often practised at too low a level – and those climate scenario modelling outputs, alas! We have even stumbled across the ‘ghost of Enron past’ in accounting and auditing. More than one actuary is supporting Rethinking Capital’s work on ‘Accounting for Reality’.

[....]