Extreme climate events are increasing in frequency and severity.
A series of storms and widespread flooding has ravaged Europe in early 2020. And Australia has seen unprecedented bushfires—expected to have cost their economy over $100bn.
Global500 companies, meanwhile, face an estimated $970bn risk from climate events. This is just a fraction of the impact the crisis presents for businesses and society. And the effects will only become more acute.
While regulators, investors and the public are putting pressure on businesses to deploy more sustainable practices, there’s a lack of clarity on what risks pose the greatest threats to individual businesses, particularly when it comes to climate.
Herein lies the problem.
There’s a significant gap between the awareness businesses have of the climate crisis and the action they can personally take to mitigate the implications.
Climate security, however, enables organisations to take holistic action to secure and protect national, corporate and human interests in the face of climate instability. By sourcing a bespoke analysis of how each part of a business will be affected by climate volatility, they’re able to assess and respond to asset-level risk.
Business leaders and boards therefore need to consider climate security in 2020 before it’s too late.
Mapping and forecasting climate risk
Assessing and addressing the challenges a volatile climate presents has frequently been viewed as difficult, expensive or intangible. The issue is exacerbated by the fact no single individual, organisation or government can manage climate threats alone.
Businesses, again, aren’t exempt here. While there’s a need to recognise the risks the climate has on them directly, strategies can’t be developed in isolation. They must consider, and address, the risks it presents to their entire value chain.
Many business leaders will be intimidated by the prospect (or perhaps even unaware) of their overall climate responsibility. But advances in science and technology can help organisations navigate this evolving crisis.
Artificial intelligence, combined with advances in data engineering, machine learning and proven Earth Science techniques means technology today can interrogate the extensive, remote sensing data and climate projections being gathered by satellites, sensors and scientists across the globe. This means that this vast information pool can then be translated into highly personalised, accurate and dynamic maps of the changing climate for any organisation to query their own assets against.
Painting a holistic and interconnected view in this way is central to giving businesses clarity on critical climate decision making. And eventually, these AI tools will be able to assess the climate risk for any asset, anywhere on the planet. Not just the present month or week but for years or even decades in the future.
Taking climate security action now
The recent storms and floods in Europe are anticipated to have cost around $2bn to the insurance industry.
Costs like these will only increase as the climate becomes more volatile.
The Investment Association also has announced it will demand all UK-listed members to comply with the standards set by the Task Force on Climate-related Financial Disclosures (TCFD) to ensure effective scenario planning is in place. Ultimately, businesses will lose significant value if they aren’t responding to the risks that climate volatility presents. Investors will increasingly demand clear, proactive climate policies to be in place in order to part with funds.
Businesses therefore need to change, and quickly.
Corporate sustainability practices and regulations that are inherently reactive have no value in 2020 and beyond. There’s nothing sustainable about waiting for a disaster to hit, or simply hoping for good luck.
All of this sounds familiar, doesn’t it? Cybersecurity, for years, was a nice to have. Influencers and experts campaigned relentlessly to help organisations understand where websites and apps were vulnerable. However, it took a series of high-profile hacks, election-meddling and a meltdown in the protection of global personal data for businesses to give cyber security the time and attention it needed.
We can’t afford to make the same mistakes and wait before climate security is given a similar focus. The implications of the climate crisis are far greater and time is running out.
Grasping the complexities that climate volatility presents to organisations isn’t easy. But business leaders need to shift their focus and recognise the gap between their awareness of the climate crisis and their ability to act.
Until organisations garner the personal insights (and clarity) they need to tackle these threats, discussions will be simply hot air.
A focus on climate security will build not only more resilient businesses but have a restorative impact on our planet. Those companies that bury their head in the sand are putting their future in jeopardy.
About the Author
Iggy Bassi is founder and CEO of Cervest. Cervest is pioneering Earth Science AI to help businesses, governments and growers adapt to climate volatility. Using machine learning, it generates real-time streamed ‘signals’ to answer questions linked to climate uncertainty, land, and natural resources. It brings clarity to decisions to help mitigate risk, safeguard food and ensure economic security – and supports the restoration and resilience of our planet and its people. Find out more: cervest.earth
Featured image: ©Malp