As he joins the Institute for Climate Risk & Response as Industry Fellow, Nick Wood reflects on how climate risk has shifted - from denial and delay to data, disclosure, and the urgent need for professionalisation.
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A nuclear scientist by training, former head of carbon advisory at KPMG, and now an Industry Fellow at the ºÚÁÏÍø´óÊÂ¼Ç Institute for Climate Risk & Response (ICRR), Dr Nick Wood has spent decades navigating the uneasy intersection of science, finance, and denial. He caught up with the ICRR to talk about his career solving hard climate risk problems – and confronting even harder truths.
My father was a botanist, and my mother was a doctor and specialist in tropical medicine, working in botanical gardens, hospitals, universities, and remote research stations around the world mostly in the tropics. I grew up with an appreciation of science both as a philosophy and as a fundamental human skill which we can use to tackle big, challenging questions. I was completing a PhD in nuclear reactor technology when happened. Everything shifted. As far as I know I ended up being the last student in the UK funded in that field, and I moved into acid rain research. That was my first real encounter with denial. You’d be in rooms with top-tier business leaders in the UK energy sector and they would actively resist the reality of the devastation that acid rain was causing to the pine forest of northern Europe. Coming from a background where science was simply a tool, which made no sense to me. I’ve found this tension – between science and delusion – fascinating, and it has followed me ever since.
People usually only come to you when they have a problem – often a physical risk they can’t ignore anymore because it’s already undermining their survival.
At that point, climate science is no longer ideological; it has become the best tool available to deal with the challenge.
Business doesn’t really have a choice. It’s not about belief. It’s about using the best information we have.
Yes, the models are imperfect, but we still have to use them. Around 2013, climate models became good enough to inform investment decisions. That’s when I began working with people like Andy Pitman and Tanya Fiedler to translate science into financial risk frameworks. I co-authored a , led by Tanya, which remains highly influential in how we make decisions allowing for the uncertainty of the science.
Finance is where things get real. In 2019, I worked on a project with CSIRO and the Commonwealth Bank to deploy the best available science to assess levels of financial risk. That work ended up in the bank’s .
Across the next few years, I worked on multiple projects to build the linkages between the climate science and the capital markets in one form or another The key point was to demonstrate that climate change was emerging as form of sovereign risk and that capital markets needed to understand how to work in this new world.
I remember the shocked reaction of a senior bureaucrat when a global credit rating agency asked if it could use Australian climate data to re-rate our sovereign debt. That’s not ideology, that’s economic survival. It took years to get there, and it wasn’t traditional consultancy work. It was strategic, and I often worked pro bono, and behind the scenes.
Climate science is largely publicly funded and the output from that research is mostly open source. Consequently, I am able to independently corroborate (or otherwise) climate related claims made in a company’s sustainability report; I can go to the models myself. That shifts the balance of power. Sustainability reporting has too often been a one-way street in terms of information flowing outwards from the business. It also tends to be backwards looking and “good news only. Greenwashing did not write itself.
Climate risk is different. It’s hostile analytics. It’s accountability.
If you know there’s a risk and hide it from investors, that’s fraud. That’s where climate risk disclosure is heading. And it’s not just about compliance – it’s about survival.
The community of climate risk experts in Australia is still small enough that everyone knows each other. That’s how change happens – clusters of the right people in the right room. It’s how Silicon Valley happened, how the Industrial Revolution began in Northern England. We have the science, the finance sector, and the networks. Now we need to leverage them.
Many private sector organisations prefer to think they have an appropriate level of climate expertise. In my view, they don’t. They’ve had sustainability managers for a decade, not climate risk professionals. That’s why we need a proper climate risk profession – something we’re building at ICRR.
We’re trying to repair the structural weaknesses left by years of delusion and denial. We’re training the next generation. We have the knowledge and the experience. I see ICRR as a centre of gravity for this work – bringing together business, science, and collective capability.
We’ve shifted from a stationary climate to a non-stationary one. That’s a world humanity hasn’t lived in before. Yet most businesses still act as if the future will look like the past. It won’t.
They need to start with the basics: hazard, location, vulnerability. Most businesses don’t even know where all their assets are, let alone how vulnerable they might be. They rely on insurance and outdated designs. But insurance is disappearing at the exposed margins, and those designs no longer work.
The good news is that there are solutions. It’s not hopeless. But we need honesty. Climate risk is about survival, not marketing or identity. Either you do it, or you don’t. Just don’t delude yourself.
