Guest essays by Eric Worrall
Despite minimal efforts by London banks to disclose their alleged climate risk, the Bank of England has mysteriously opted not to impose mandatory climate disclosure rules.
Banks will not be forced to reveal climate change risks they face
Tue 16 Oct 2018 00.11 AEDT
Critics demand tougher action as Bank of England stops short of call for mandatory reports
The Bank of England has stopped short of forcing financial companies to disclose the potential risks they face from climate change, despite growing calls from campaigners for such action.
The Bank has previously said that only 10% of banks take a long-term view of the risks posed by climate change, while Mark Carney, its governor, has said that failure to adapt would have a “catastrophic impact” on the financial system.
Although opting against mandatory disclosures, the Bank said firms ought to identify a senior manager with responsibility for managing the financial risks posed by climate change, with clear “board-level engagement”.
I believe the Bank of England backed way from mandatory disclosure, because forcing the application of strict accounting rules to IPCC predictions would unequivocally reveal what a pile of junk they are.
Consider the change in estimated equilibrium climate sensitivity from AR4 to AR5.
AR4: likely to be in the range 2 to 4.5 °C with a best estimate of about 3 °C, and is very unlikely to be less than 1.5 °C. Values substantially higher than 4.5 °C cannot be excluded, but agreement of models with observations is not as good for those values
AR5: there is high confidence that ECS is extremely unlikely less than 1°C and medium confidence that the ECS is likely between 1.5°C and 4.5°C and very unlikely greater than 6°C.
The AR5 estimate covers a wider range than AR4, and AR5 ditches the best estimate climate sensitivity of 3C.
In my opinion this rising uncertainty represents a fundamental failure of the underlying theory. Different attempts to estimate climate sensitivity are producing wildly different results.
Worse, there appears to be no real quality control of the compilation of at least some major climate datasets used by the IPCC, datasets which are being fed into the divergent climate sensitivity estimates.
A lone outsider recently conducted an audit of a major climate dataset and discovered HadCRUT4 is riddled with errors; really basic, obvious stuff like spelling mistakes and impossible temperatures and geolocations.
As JoNova points out, the Hadley MET Centre which produces HadCRUT4 employs thousands of full time staff, yet none of those staff were assigned to do the most basic inspection of the data underlying one of their most important climate products.
Company auditors are in a very different situation to climate scientists. There are no real consequences if a climate scientist is sloppy or makes basic mistakes, but if a company auditor gets it wrong, they can be sued, or they could even go to jail.
If I was an auditor stuck with the impossible task of making sense of such poor quality data, while trying to avoid personal legal jeopardy, the most significant risk I would include in the disclosure statement would be the risk that the climate data used as the basis of the disclosure statement might be utterly unreliable.
Perhaps the risk of this embarrassment is the real reason the Bank of England backed down on demanding mandatory climate disclosure statements.