Losses of millions due to floods or low water: Even the economy is affected by the consequences of climate change. The world association TIC Council accompanies companies on the way to sustainability.
Cities like London, Sydney, Melbourne or Paris, but also Konstanz, Kleve and Cologne have declared a climate emergency. Climate change, with its hardly calculable effects, has also moved to the top of the list for companies worldwide as a risk factor for their business and the supply chain and, with a blatant leap upwards, has eclipsed other dangers such as cyberattacks or upheavals caused by new technologies.
The British consulting firm Longitude has revealed a further result in its survey of around 400 globally active companies with a turnover of more than 100 million dollars: The managers feel abandoned by the politicians because they do not set up any rules for the economy in the fight against disastrous developments. Equal conditions for all, however, are the prerequisite for ensuring fair competition in this area as well.
Floods, fires, extremely low water – the events of the past year caused by global warming were not only worrying and unsettling, but also cost the economy a lot of money. Starbucks feared for its coffee supplies, Mazda suffered losses in the hundreds of millions due to flooding, and the German chemical giant BASF also suffered enormous losses due to the low water level in the Rhine.
Meanwhile, more than 70 percent of the companies surveyed in Europe, Asia and North America are prepared to spend more money to counteract climate change – the increase in expenditure could amount to up to 14 percent. In general, 59 percent of companies feel that they are well positioned in terms of risk management, but more than half feel that they are less robust than a year ago with regard to climate change, according to the study commissioned by the testing and certification industry (TIC). A full 79 percent of respondents have already changed their supply chain.
Not only for insurers and reinsurers are the weather extremes and their consequences a huge topic. “Financial investors are increasingly looking to climate resilience among companies,” stressed TIC Council General Director Hanane Taidi. That is a great driver. In order to better absorb climate risks, 47 percent of companies currently want to reduce their energy consumption, 37 percent are aiming for a reduction in CO2 emissions, and in the USA the focus is on better waste management.
To mitigate climate change, 66 percent of companies have already introduced new control systems, and half of them report their progress to their shareholders or the public in an annual report. And within the supply chain, shippers are increasingly demanding precise environmental indicators from their carriers in order to include them in their own balance sheets. Peter Paul Ruschin, who heads the Sustainability SHEQ & Sustainability department at Dekra Assurance Services, has found that more and more companies want to become CO2-neutral and are making corresponding demands.
His field of work as a service provider in this area is extensive. “It ranges from independently audited sustainability reporting and calculations of the CO2 emissions caused by the manufacture of a product to the evaluation of various types of packaging and their impact on the environment,” says Ruschin. Climate resilience has become a competitive factor and its traceability a major issue.
Previously published on DEKRA Solutions.