sion. We find that the proposals that the SEC (Securities and Exchange Commission) develop a clear financial disclosure requirement for climate change risks are likely to facilitate transparency and comparison of corporate exposure.

Recommendation 3:

Decision makers in both public and private sectors should implement an iterative risk management strategy to manage climate decisions and to identify potential climate damages, co-benefits, considerations of equity, societal attitudes to climate risk, and the availability of potential response options. Decisions and policies should be revised in light of new information, experience, and stakeholder input, and use the best available information and assessment base to underpin the risk management framework.

There are important areas in which iterative risk management is already being used to manage climate risks. For example, the Federal government uses the Federal Crop Insurance Corporation (FCIC) and National Flood Insurance Program (NFIP) to share and reduce the risks of current weather variability for farmers and homeowners. However, the insurance programs do not take into account climate change, its impact on likely losses, and the fiscal implications. In the private sector, some firms already report on their management of environmental impacts to government and shareholders, but reporting can be inconsistent, and many firms still do not take into account climate risks (e.g., responsibility for emissions, policy uncertainty, and climate impacts) in their planning and disclosure.

Recommendation 4:

The federal government should review and revise federal risk insurance programs (such as FCIC and NFIP) to take into account the long-term fiscal and coverage implications of climate change. The panel endorses the steps that have already been taken to by federal financial and insurance regulators, such as the SEC, to facilitate the transparency and coordination of financial disclosure requirements for climate change risks.

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