For years, climate change warnings have followed a similar pattern: Act now to prevent catastrophic consequences in the future. Yet as we go into the 27th United Nations Conference of the Parties (COP27) climate summit in Sharm El-Sheikh, Egypt, that message alone is not enough. We must also focus on the need to protect ourselves and our planet today.
Climate change is no longer a far-off threat. It is here, affecting lives and livelihoods and disrupting hydrological and other ecological cycles. The earth has warmed 1.1 degrees Celsius above pre-industrial levels, and the number of climate- and weather-related disasters has increased almost 35 per cent since the 1990s. Just consider the recent devastating floods in Pakistan and Nigeria that have killed hundreds and displaced millions.
While we must prevent further temperature increases by continuing to mitigate our greenhouse gas emissions and regenerate food, water and ocean systems, we must also get serious about coming together to adapt to the climate realities of today. Climate adaptation must be part of a holistic climate change strategy. That means reviewing and adjusting our business and policy approach, and deploying technological, finance and other solutions to be more prepared for, and responsive to environmental change and weather events.
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It is clear that we must do more to help those most at risk. According to the most recent UN Intergovernmental Panel on Climate Change (IPCC) report, almost 3.3 billion people – half of the world’s population – live in highly vulnerable climates. Those most at risk are often also those least responsible for climate change and least equipped to respond to its impacts. Consider, for example, the fate of small island nations facing the catastrophic effects of rising sea levels.
But adaptation is not just for the most vulnerable. As recent extreme weather events across the developing and developed words showed, we are all exposed to the effects of climate change. Droughts, wildfires and other natural disasters are increasing in frequency and intensity, leaving in their wake lost lives, damaged infrastructure and disrupted supply chains. Every government, company and individual needs to prepare.
The longer we wait to focus on adaptation, the more lives will be affected, and the more difficult and expensive it will be. The UN estimates that the current cost of meeting adaptation needs is US$70 billion. By 2050, it could reach US$500 billion. According to the Carbon Disclosure Project, just for water risks alone, the costs of doing nothing is five times that of acting today.
So, what can we do to accelerate adaptation efforts?
Until now, climate adaptation has largely been considered the responsibility of governments, multilateral institutions and donor agencies. Several countries have developed National Adaptation Plans under the UN Framework Convention on Climate Change, and COP26 was a pivotal moment with the adoption of the Glasgow Climate Pact, which calls for a doubling of financial commitments to helping developing countries adapt and become more resilient.
But governments cannot do it alone. Even if they meet the goals set out last year, investments into adaptation would still fall short of what is needed.
The private sector must also step up – and there is a clear business case for doing so, as a new World Economic Forum paper, in collaboration with PwC, outlines.
By assessing risks along their value chains and working with suppliers and communities to identify the skills and resources needed to withstand shocks, businesses can better manage and mitigate the risks to their operations and avoid severe economic losses. They can also capitalise on opportunities to invest into products, services and business models that address the adaptation needs of their stakeholders, benefiting from increased efficiency, innovation, and sustainable growth. Globally, a $1.8 trillion of investments into adaptation efforts could generate $7.1 trillion in total net benefits by 2030, according to a 2019 report by the Global Commission on Adaptation.
Businesses can leverage their experience with emerging technology and data-driven insights. For example, energy company Sempra applies sensor technology and weather data to help fight wildfires before they get out of control, both safeguarding their energy infrastructure from disruption and helping ensure public safety.
Countries can also work with financial institutions and other partners to explore financing instruments to better protect vulnerable areas. For example, together with the Nature Conservancy and the US International Development Finance Corporation, Credit Suisse offered their financial and capital markets expertise to create blue bond financing for Belize. This seeks to invest into marine management, coral reef and mangrove restoration, strengthening coastal resiliency and enhancing sustainable economic development.
In addition, businesses can explore enhancing the climate resilience of infrastructure and communities though nature-based solutions. For example, professional services company Arup works with local governments to implement green building design and disaster-resilient infrastructure, such as helping Freetown, Sierra Leone rebuild from a devastating landslide in 2017 by applying a nature-based and flood-risk-management strategy.
Finally, businesses can provide leadership and shape the broader agenda on adaptation by collaborating with governments, development agencies, academia and other industry players to shape policy and change behaviours.
At COP27, we will have an unprecedented opportunity to do so. While adaptation has always been on the global climate agenda, it is now finally prioritised, alongside mitigation solutions and other issues.
Neo Gim Huay is managing director, Centre for Nature and Climate at the World Economic Forum.