Managing Climate, Cyber, Geopolitical, and Financial Risk: An Integrated Approach

Catalog description

Businesses and governments now face a growing and immediate array of nonfinancial risks, including climate-related, cyber and operational, geopolitical, and pandemic risks. Precisely because these critical risks are hard to measure and analyze, firms are putting both new and old resources – AI, data, people and money – to work to anticipate, manage and mitigate them. To address cybersecurity risks, for example, JP Morgan alone has 3000 employees and spends $600 million annually. Firms are only starting to grapple with existential climate-related and other risks. And startups are mushrooming to provide assessments to businesses. This course will study these risks alongside financial risks. It will outline frameworks for measuring, assessing and analyzing them, and for actions needed to meet them. We will examine case studies of climate, cyber, geopolitical and pandemic risks, including from current events. We will assess the spillovers among these risks, and why an integrated (e.g. enterprise-wide or system-wide) approach helps to manage them. Finally, we will study whether and how the information in financial markets can both inform the assessment of these risks and potentially provide tools to transfer, insure against or hedge them.