Rethinking Risk in an Unstable Climate

At our S2G Summit, Barney Schauble and Spencer Glendon called for a radical shift in how capital markets, investors, and communities understand climate risk. From the evolution of insurance to the destabilizing force of warming, they argued that climate literacy — not just carbon accounting — is now essential for sound investment decisions.

Key Takeaways

Risk Is the Missing Conversation

While climate discussions often focus on emissions, technologies, and AI, they frequently ignore the core issue of physical climate risk and its shifting probability distributions. Understanding these risks is essential to making informed investment decisions.

Implicit Climate Models Are Wrong — Scientific Ones Are Useful

We believe most decisions, from investing to infrastructure planning, are built on the assumption of climate stability — a reality that no longer exists. Glendon emphasizes that everyone operates with a ​“climate model,” but it’s often based solely on the past.

Insurance Can’t Bear the Load

Insurance markets were created to pool risk under stable conditions. As risks escalate and historical assumptions break down, insurers are exiting markets — making insurance either unavailable or uneconomic. This signals deeper structural risk that investors must now absorb directly.

Old Assumptions Are Collapsing Fast

Whether it’s the viability of greenhouses, global agricultural zones, or migration patterns, climate shifts are disrupting business models. Schauble and Glendon share examples from Chicago, California, North Carolina, and Mexico to show how infrastructure and economic systems are failing to adapt.

Investment Models Must Internalize Climate Literacy

Financial planning often spans decades, while risk protection is purchased annually. That mismatch is becoming untenable. Climate-literate planning is needed to reflect the steepening curve of climate volatility.

A Call for New ​“Coffee Houses”

Referencing the origins of the insurance market in Edward Lloyd’s coffee house, the speakers advocate for new collaborative spaces — across industries and communities — where climate risk can be understood, shared, and addressed together.