October 2, 2024
Source: World Economic Forum
Photo / Image Source: Unsplash,
Many businesses recognize the need for climate adaptation, yet still seek effective strategies.
Risk managers can take action with the 3 As
Corporate risk managers are uniquely positioned to implement a dynamic risk-management approach, building on their vast experience, existing tools and innovative data and analysis. There are three key areas where risk managers can help shape effective corporate adaptation:
Ambition: Help set corporate resilience goals and establish the level of climate change and resilience to prepare for and aim for.
Analysis: Inform colleagues and partners by mapping risk across assets, operations and stakeholders and identifying possible adaptation interventions.
Action: Use risk analysis to select adaptation measures, decide how and what to prioritize, build a strong business case to secure funding and help others to implement the plans. Expertise and tools – such as our AI-driven technology Sentrisk – can help embed climate considerations into every corner of the business.
Addressing the multifaceted impacts and risks posed by climate change requires adaptation strategies to consider wider systems-level factors – everything from capital providers and government regulators to suppliers, infrastructure and customers, as well as ecosystem services and local communities.
A corporate adaptation strategy requires a 360-degree view of risk to succeed. It must consider asset-level considerations, such as the business’s core operations, people, physical assets and emergency response. But it cannot stop there.
Corporations must address supply-chain blind spots, consider how best to protect employees, work with nature to reduce risks and move from a “cost” mentality to an “investment” mindset.
Climate adaptation is basically a forward-looking form of dynamic risk management. Risk managers have many tools at their disposal to increase resilience; however, a holistic approach is needed to achieve a real step change in how corporations deal with physical climate risks. That way, business leaders can build a robust, resilient and responsible adaptation strategy.
Does your company have a climate change plan? Is it complaint with current climate laws? Why? Why not?
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