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  "documentTitle": "Sustainability Risk Under Solvency II",
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  "authorName": "Oliver Wyman",
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  "notes": "The chart visualizes the 'Tragedy of the Horizon' concept, showing how policy timing affects the nature of climate-related risks.",
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      "text": "From a risk management perspective, climate policies can therefore be understood as a trade-off between long-term physical risk and near-term transition risk.",
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      "text": "CO2 emission trajectory of different climate change scenarios",
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      "text": "With no significant policy action, levels of physical risks will increase substantially, particularly on longer time horizons. Climate policy looking to mitigate these physical risks may result in severe disruptions in certain economic sectors. Time horizon, stringency and anticipation of climate policies determines the level of disruption faced by the economy. From a risk management perspective, climate policies can therefore be understood as a trade-off between long-term physical risk and near-term transition risk.",
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      "text": "Climate change related risks are present with or without policy action in the form of physical or transition risks. For a near-term assessment, transition risk is particularly relevant.",
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      "kind": "title",
      "text": "CLIMATE POLICY LOOKS TO MITIGATE SEVERE PHYSICAL RISKS ON LONGER TIME HORIZONS BY ACCEPTING A CERTAIN LEVEL OF SHORT-TERM TRANSITION RISK",
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