Climate change offers opportunity for businesses
A UN survey finds that climate adaptation creates a wealth of new opportunities for the private sector.
BRIDGETOWN, Barbados, Thursday June 23, 2011 – Climate adaptation offers competitive advantages to businesses worldwide, according to the new report, ‘Adapting for a Green Economy: Companies, Communities and Climate Change’, jointly released by the UN Global Compact, the UN Environment Programme (UNEP), Oxfam and the World Resources Institute.
In response to a survey of global businesses, 86 percent described responding to climate risks or investing in adaptation as a business opportunity.
"Business can only thrive in stable and enabling environments," said Georg Kell, Executive Director of the UN Global Compact. "Climate adaptation offers a pathway to help communities that are already feeling the devastating impacts of climate change. At the same time, it creates a wealth of new opportunities for the private sector."
Drawing on the results of a 2010 survey among companies engaged in ‘Caring for Climate’, the joint climate action platform of the UN Global Compact and UNEP, the study makes the business case for private sector adaptation to climate change in ways that build the resilience of vulnerable communities in developing countries, including those in the Caribbean.
Already, businesses worldwide are beginning to see the risks and economic impacts of more frequent and intense storms, water scarcity, declining agricultural productivity and poor health.
"We live in a world where extreme weather events on one day can move food and fuel prices the next, impacting vulnerable and poor communities and a company's supply chain. We also live in a world where infrastructure established decades ago will become increasingly at risk to events such as storm surges and high winds that, in turn, threaten the viability of the business-as-usual models of the past, and the profits or losses of firms for the future,” said UN Under-Secretary-General and UNEP Executive Director Achim Steiner.
"There are multiple reasons why the world urgently needs a transition to a low-carbon, resource efficient Green Economy, including climate change and adapting to its impacts. This report underlines that climate-proofing is not just a responsibility of governments, but should be at the centre of more and more companies' business models and forward-looking corporate strategies," he added.
The study suggests actions that companies and policymakers can pursue to catalyze and scale up private sector engagement. Confirming the notion that the climate threats many communities face are also business risks, 83 percent of companies surveyed responded that climate change impacts pose a risk to their products and service.
"Businesses are facing increasing challenges from the rise in extreme weather events- such as droughts, heat waves and floods," said Manish Bapna, Managing Director, World Resources Institute. "In this changing environment, companies that move first to address the risks and develop innovative strategies to adapt to climate change are likely to be the winners and gain a competitive advantage moving forward."
The study recommends, among others, that businesses integrate climate adaptation into core strategic planning and build a portfolio of climate-resilient goods and services. Addressing policy makers, the authors call for stronger policy and finance commitments to adaptation, financial and risk-reduction incentives to stimulate the market, and for new forms of public-private partnerships.
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