Most big European businesses are already experiencing negative impacts from climate change, according to a new survey.
The CDP study of 270 of the largest listed European companies from 20 countries has found that in some sectors more than half the anticipated impacts of climate change have already made themselves felt in some way or other.
However, the extent to which companies are experiencing impacts depends largely on the sector they are in. In the financial industry, for example, 51% of identified impacts from climate change are already happening, while in the energy sector that figure is 35% – with 53% of impacts not expected for at least another 10 years.
‘Businesses across a wide range of sectors are already experiencing the impacts of a changing climate, and are taking this issue seriously,’ concludes the CDP. It says the survey results provide further evidence that European policymakers ‘must work with the private sector to address climate risk and build resilience’.
The companies from 10 sectors identified a total of 780 different risks from climate change impacts in their businesses. However, they also pinpointed 379 potential business opportunities, most often in the form of anticipated increases in demand for certain products and services.
The most common negative impact already experienced, cited by 32% of companies, has been a reduction in production capacity – typically due to a disruption in the supply of produce or products. A similar proportion (31%) say climate change has already caused an increase in operational costs – including due to raises in insurance premiums – while one in ten say they have experienced a complete inability to do business at certain times, for instance due to IT infrastructure being interrupted by flooding or severe weather.
The CDP, which works with companies to disclose their impacts on climate change, says water was confirmed by the study as being a particularly pressing climate change issue for businesses, with 96% of respondents saying they now have a water management policy, plan or strategy in place and 81% reporting board level oversight of such policies.
The study was released shortly before publication of the Intergovernmental Panel on Climate Change’s latest report, which warned that no one on the planet will be untouched by the damaging effects of global warming in coming decades.
Since 2011, a group of PRI signatories have been involved in CDP Carbon Action, an investor-led initiative facilitated through the PRI Clearinghouse to encourage companies to move from disclosure to action on reducing emissions and mitigating climate change risks. More information about current PRI engagements is available here.