Climate capital and risk: Carbon ratings agencies and the dynamics of governance

Climate capital and risk: Carbon ratings agencies and the dynamics of governance

Carbon markets are seen as controversial and high stakes for corporate and state actors. Yet carbon trading remains the preferred solution to climate change with market-making activity proliferating globally. This paper examines the role of carbon rating agencies in emerging forms of climate governance under the Paris Agreement. Carbon raters assess projects and assign risk ratings based on epistemic assumptions and calculative practices. Consumers of the risk ratings are then provided with information to make prudent investment decisions. Drawing on preliminary analysis of public documents and scoping interviews with carbon raters this study contends that raters are critical intermediaries in the advancement of disclosure-based governance. Raters vindicate and strengthen voluntarist, disclosure regimes. The paper contributes to climate risk and governance research by showing how carbon rating agencies use discursive means to formulate market positions and, in the process, shape the governance of climate change.

Bio

Sasha Maher is Lecturer in Sustainability at the University of Auckland Business School and an economic anthropologist whose research focuses on the organization and governance of carbon finance, markets, and climate leadership. She explores questions of governance and leadership through political economic and anthropological lenses, employing ethnographic, qualitative approaches. Prior to joining academia, she advised an environmental NGO and spent over a decade working in agribusiness. She is an Affiliate at Motu Economic and Public Policy Research, the Circular Economy Beacon, and the Centre for Climate, Biodiversity, and Society at the University of Auckland