The climate is also changing for financiers and fund managers

The company has been withdrawing funds from companies which have refused to take seriously the threat of global warming.

It has been naming and shaming ‘climate change laggards’, such as America’s second largest utility, Southern, Japanese car maker Subaru, and the China Construction Bank.

While Extinction Rebellion brings protest to the street, a quiet revolution is being organised within the citadels of capitalism in thickly carpeted boardrooms.

The revolution is in its early stages and it is being fiercely contested by powerful people who see a short-term threat to their financial returns or simply do not subscribe to the analysis of groups such as the Intergovernmental Panel on Climate Change which, last year, warned that we have around a dozen years to halt runaway changes in the climate.

The Bank of England governor Mark Carney has been leading the charge, but he is being backed by a wide range of prominent individuals and institutions.

He is more aware than most that a dramatic degradation of the global environment poses a threat to the foundations of the financial system on a number of fronts. The bank will be the first regulator to stress-test the financial system using various assumptions regarding the rate of global warming.

Writing in the in-house magazine of the IMF, Mr Carney said that while the human costs stemming from the warming of the planet are immeasurable, the likely financial costs can be measured.

Take claims on insurers from various weather events, for example. These amounted to €72bn in 2018 — double the inflation-adjusted average claims lodged during the past 30 years.

In 2017, the claims figure was a record €127bn, but you can add to this damage estimated at €180bn to people and businesses, mainly in poorer countries, without property insurance.

In countries such as Nigeria, Indonesia, India, Vietnam at the very sharp end of the crisis insurance penetration is less than 1%. In this case it is not insurance companies, but societies and individuals, which pick up the tab.

In Syria, it is reckoned that a long drought acted as a catalyst in a civil war that has produced over 500,000 deaths and millions of refugees. Expect many more such events.

Mr Carney believes that attitudes are changing. “The bank’s latest survey finds that almost three quarters of banks are starting to treat the risks from climate change like other financial risks,” he said.

First, there are the more immediate physical risks to property and life from flood and fire. Then there are the exposures that come with the transition to a lower-carbon economy. Lenders must look more carefully at loans for the purchase of high-emitting vehicles, or properties with poor energy ratings.

While a new sustainable financial system is under construction, it is not happening fast enough, says Mr Carney.

“This is the tragedy of the Horizon. The catastrophic effects will be felt way beyond the traditional horizons of most actors, imposing a cost on future generations that the current generation has little incentive to fix,” he said.

Some key players have been cheating — literally in the case of some leading car companies. Other players have been engaging in climate ‘window dressing’ activity, creating an appearance of action where it does not exist in reality.

Christopher Hohn, founder of the TCI hedge fund, has just called out one of the world’s leading asset managers, Blackrock, arguing that its CEO, Larry Fink, has failed to back up his rhetoric on climate action. Mr Fink has been an industry leader when it comes to the launch of environmentally friendly ‘ESG’ — or environmental, social and governance - funds. However, Mr Hohn says Blackrock has also been pouring money into fossil fuel firms through its mainstream funds. He accused Blackrock of ‘greenwashing’.

Blackrock and similar groups are urged to screen their investments to take account of climate issues. A leader in this area is Japan’s Government pension fund, with assets of €1.5tn, which has imposed new environmental protection standards across its entire portfolio.

The World Economic Forum is on the case, seeking to force leading asset managers across the globe to agree to new standards. The G20 financial stability group has set up a Task Force on Climate Related Financial Disclosure. Legal & General Investment Management is proposing to embed a focus on climate change risk into agreements between it and investee firms.

It points to real progress on the ground.

Examples include the Spanish utility Iberdola which has gone from being largely fossil-fuel powered to having 60% renewable energy capacity in less than a decade. Last year, Legal & General Investment Management’s Future World Fund withdrew its investment from eight companies due to “persistent inaction in addressing climate change”.

Legal & General Investment Management reported that the climate scores of investee companies had improved in all six sectors. However, there were also “signs of stagnation” among financial and retail firms while the gap between leaders and laggards among US companies was particularly striking.

High points include the fact that in 2018, Rio Tinto became the first major mining entity to hold no coal assets while BHP Billiton has indicated that it is phasing out its coal operations.

The big question is whether at a time of continued rises in carbon emissions, the change in corporate attitudes and in strategy on this crucial issue is coming fast enough. It is in the boardroom as much as on the streets that our futures will be determined.