A global survey of 1,000 experts places environmental degradation as “the long-term risk that defines our age”, with firms urged to develop strategies to cope with worsening climate change.
The Global Risks Report 2019, launched at the World Economic Forum in Davos in January, incorporates the results of an annual survey of experts and decision makers across the globe.
Environmental risks dominated respondents’ concerns, with five of the top six most impactful risks identified (failure of climate change action, extreme weather events, water crises, major natural disasters and major biodiversity loss) related to climate change.
Climate dominates global risk
The news comes at the same time as the UK Met Office announced that it expected to see one of the largest annual rises in atmospheric greenhouse gas concentration in 62 years of measurements in 2019.
“2018 was sadly a year of historic wildfires, continued heavy flooding and increasing greenhouse gas emissions. It is no surprise that in 2019, environmental risks once again dominate the list of major concerns. So, too, does the growing likelihood of environmental policy failure or a lack of timely policy implementation”, explained Alison Martin, group chief risk officer at Zurich Insurance Group.
“Against this backdrop, we strongly recommend that businesses develop a climate resilience adaptation strategy and act on it now.”
According to the Carbon Trust, around two-thirds of UK corporations will be disclosing climate-related risks and opportunities in their 2019 annual reporting.
‘Markets moving quickly’
The forecast was based on interviews with 100 board members from the UK’s top 500 companies. Seven in ten believed that the reporting would increase brand value, while one third of respondents expected it to lead to a financial benefit.
Hugh Jones, managing director of business services at the Carbon Trust, said: “Our changing climate is moving markets more quickly than many had anticipated. Incidents of extreme weather are increasing, the adoption of clean technology is accelerating, and more customers are changing their behaviour.
“For corporate leaders, going through the process of assessing their company’s climate change opportunities and risks is a vital strategic tool for navigating the necessary transition to a sustainable, low carbon economy.”