Resilience for organisations is bound to their adaptability to climate change both in the short and long term.
A review of US public companies shows a number of climate related risks and costs. Their ability to adapt and become resilient to climate change is starting to affect their finances.
The document reveals that USA S&P 500 companies are seeing climate change related risks increase in urgency, likelihood and frequency, with many describing significant impacts already affecting their business operations, according to a new report from CDP, which collects environmental performance information on behalf of investors.
Threats include damage to facilities, reduced product demand, lost productivity and necessitated write-offs. The impact of these threats being realised comes with costs that can reach millions of dollars.
Importantly, the proximity of the threat is quite near. 45% of the risks S&P 500 companies face from extreme weather and climate changes are current, or expected to fall within the next one-to-five years, up from 26% just three years ago. 50% of these risks range from “more likely than not” to “virtually certain”. This is up from 34% three years ago.
Around 60 companies describe the current and potential future risks and their associated costs in the research, which highlights excerpts from the companies’ disclosures to their investors between 2011 and 2013. Ironically, even NewCorp made the following contribution to the report.
“Climate projection models make it difficult to know exactly how business might be impacted by episodic weather events. However, it is clear from past severe weather events that some of News Corporation’s businesses are susceptible to such extreme weather.”(p6)
The media release accompanying the report asserts that
Dealing with climate change is now a cost of doing business
Making investments in climate change related resilience planning both in their own operations and in the supply chain has become crucial for all corporations to manage this increasing risk.
Resilience Outcomes has the skills and expertise to help your organisation develop its organisational resilience strategy to take into account how it will adapt to the changing environment. contact us via the form below or at [email protected] to discuss your needs.
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CDP is an international, not-for-profit organisation providing the only global system for companies and cities to measure, disclose, manage and share vital environmental information. We work with market forces to motivate companies to disclose their impacts on the environment and natural resources and take action to reduce them