UNEP Report Released: A New Angle on Sovereign Credit Risk, E-RISC: Environmental Risk Integration in Sovereign Credit Analysis
Yesterday, the United Nations Environment Programme released a new report titled, A New Angle on Sovereign Credit Risk, E-RISC: Environmental Risk Integration in Sovereign Credit Analysis (2012). The 40-page report available here, examines five test countries including Brazil, France, India, Japan and Turkey and addresses how,
[l]oss of soils, forests and fisheries, as well as rising resource costs, are
likely to become increasingly important to a nation’s economic health, and may
affect its ability to repay or refinance sovereign debt, says the study issued
by the United Nations Environment Programme’s Finance Initiative (UNEP FI).
The report suggests that factoring the way a country manages natural assets
into sovereign bond ratings may not only give investors increased transparency
when making investment decisions, but also encourage governments issuing
sovereign debt to manage their natural resources more sustainably in order to
attract investors over the medium to long term.
Post a Comment