CBI says businesses need better warning of climate risks

Employers’ group says all listed firms should detail their “climate exposure ” in corporate reports


A flood sign warns of flooded areas following the torrential rain
A flood sign warns of flooded areas following the torrential rain – the CBS says businesses are worried about risks such as flooding, which are predicted to increase in frequency and severity with climate change. Photograph: Matt Cardy/Getty ImagesClimate scientists and the government must improve the way in which they communicate the risks associated with climate change if they want businesses to make the adaptations necessary to cope with rising temperatures and extreme weather.

That is the stark warning contained in a major new report released today by business lobby group the CBI, which also recommends that all firms should provide information on the climate risks they face as part of their corporate reports.

The report, entitled Whatever the weather: managing the risks from a changing climate, calls for the government to create a new “public information bank” that clearly demonstrates the climate risks faced by key infrastructure and makes it easier for businesses to understand how they are likely to be affected.

Dr Neil Bentley, CBI director of business environment, said most of the climate risk data businesses needed was already in the public domain, but it is often difficult to understand. “The government must help ensure that businesses have the information needed to take action,” he said. “This data… needs to be made available in an easy-to-use format.”

In particular, the report recommends that the existing UK Climate Projections should be repackaged so that they can be easily understood by non-climate specialists and that the government’s upcoming Climate Change Risk Assessment should feature specific recommendations on how regulated sectors need to adapt to climate change.

It also notes that businesses need to take action to improve their climate resilience and understand their climate risks.

“Many businesses aren’t ready for the changes that could be ahead,” admitted Bentley. “The impact of climate change needs to be made part of an ongoing risk management and we must also ensure that what we build today is resilient enough to withstand changes to the climate over the next century.”

The report recommends that all firms should include climate risks in their wider business risk assessments and incorporate adaptation measures into their wider sustainability strategies.

Significantly, it also advises that listed firms should include details of their “climate exposure” in their corporate reports and should share non-commercially sensitive climate adaptation information with rivals.

In addition, the report argues that businesses undertaking climate risk assessments should look beyond the direct impact of rising flood and drought risks on their own assets and operations and take into account how climate change will impact their supply chains, markets, corporate reputation and regulatory landscape.

The report is the latest in a series of moves from the employers’ group calling on the government to strengthen its climate change policy. Most notably, it warned last month that up to £150bn of low-carbon investment was being delayed as a result of the coalition’s failure to clarify details of its energy policy.

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