ABSTRACT
The global financial system is both exposed to and driving a new type of systemic risk. This systemic risk relates to the stability of Earth’s life support system. The Earth system – climate, ice sheets, forests, rivers and oceans, and biodiversity – is undergoing rapid and profound change. The age of stability (and predictability) may end soon if humanity does not tread carefully. In its place will come an age of increasing uncertainty. This new age is defined by speed, scale, surprise, and interconnectivity. In 2009, the first coherent framework for Earth system risk management emerged – planetary boundaries. This chapter will discuss a safe operating space for the global economy. It will explore how economies and businesses can develop within planetary boundaries in order to reduce risks of crossing tipping points that jeopardize further economic development.
