Eleven sectors with a combined $2.2 trillion (£1.67tn) of debt are highly exposed to risks posed by climate change.
Financial services firm Moody’s says the two industries facing the most immediate risk are unregulated power and utilities companies and coal businesses – together, these markets account for a $517 billion (£392.8bn) of rated debt.
A new report from Moody’s suggests they are at high risk because they are directly exposed to policy pressures to cut emissions, disrupting their business models and limiting their margins.
It shows the impact on generators is lower in Asia than in Europe, as power demand is still seeing significant growth, with less stringent emission reduction policies.
An additional nine sectors, including car makers, fossil fuel firms and chemical producers, could face their credit being affected by high levels of environmental exposure within three to five years.
Rahul Ghosh, Senior Vice President at Moody’s, said: “In particular, carbon transition risk is a significant credit consideration for 10 of these elevated risk sectors exposed to carbon regulation.
“As governments seek to fulfill their Paris Agreement commitments, the tightening of regulatory regimes governing carbon dioxide emissions is having a tangible and in some cases, disruptive impact on the most exposed industrial sectors globally.”