Part of a series taking important concepts and wording them so you can pass basic information to your colleagues, supervisors, and contacts.

Background

There is no getting around it. Even with the politics of current US leadership being in denial, there is too much factual evidence and too many solid reports from non-partisan scientists to deny: Climate Change is real and will have grave impacts on our very being. The only things we do not know are just how fast and potentially destructive these changes will be, which segments will be hit first and hardest, and what we can do to absorb the changes. While we do not know the details, we need to prepare.

Therefore, the growth in the number and severity of severe storms, rising temperatures, rising sea levels infiltrating drinkable water, public health issues, etc. represents major risks that will cost our planet many lives and much money. However, change also represents an opportunity, seen in any business. The business person who can correctly anticipate change and prepare for it to minimize negative effects and perhaps even turn the “lemons to lemonade” will come out ahead. This has been true for hundreds of other societal and technological changes we have been through.

Climate Change Impacts

First, let’s make clear that Climate Change is not something we should do for the sake of “our children and grandchildren.” Climate Change is already impacting societies and businesses. 2018 was a record year for extreme weather events – droughts, rain bombs, wildfires, melting glaciers and polar vortexes, costing approximately $215 billion, according to insurance giant Aon. Did Climate Change cause these events such that getting the CO2 concentration back down to the long-held 280 ppm baseline will eliminate these events? No. But it is universally agreed in the scientific community that Climate Change – the increase in heat and energy in the atmosphere and oceans – contributed to making these storms more intense and, in many cases, beyond what societies planned for decades or more ago as “worst case.”

And if someone thinks that Climate Change only impacts people far away, well, note that Miami Beach – a 7.7 square mile, small part of Metro-Dade County with a population of only 92,000 – will spend $500 million for projects to pump out ocean water from the city. https://www.miamiherald.com/news/local/community/miami-dade/miami-beach/article209328849.html. And City officials openly admit that this expenditure may only temporarily delay the City’s demise. Climate Change is hurting us now.

Climate Change Risk

Climate Change risk is not a new phenomenon. Many governments and businesses (mostly in Europe) factor Climate Change into their decision making and forecasting. Business school define and quantify different Climate Change risks as follows:

• Competitive (cost) risks
 potential decline in consumer demand for energy-intensive products
 rise in costs or lack of availability for energy-intensive processes
 rise in costs or lack of availability for transportation fuels

• Reputational risks from perceived inaction on climate change

• Regulatory risks from tightening legislation

• Physical risks from Climate Change (extreme weather, rising sea levels, etc.)
 Asset damage
 Inability to make or transport product, raw materials
 Health and safety risks
 Project delays
 Crop damage or agricultural transition as certain crops no longer are viable in certain areas and new supply chains become necessary

Climate Change Can Be An Opportunity, Too

It is often the case that situations that introduce risk can result in the flip side: an opportunity. Companies that can manage or minimize risk will be stronger for it and those that can develop and sell products to minimize risk or Climate Change impacts for others can do quite well in the market. I gave a lecture on Climate Change years ago where I devoted a portion of it to malaria and the forecasts that in a few decades the incidence of malaria will likely grow because the warming Earth will allow the mosquitoes that spread malaria to travel further north and south on Earth, exposing potentially hundreds of millions of more people to the virus for the first time. A person in the audience noted that he works for a company that manufactures medical equipment and they have a line of products specifically for malaria. If what I said was right, there will be a greater need for these machines and sales would rise and they can make a lot of money. He then stopped and realized he said something politically incorrect. But he was right that Climate Change can represent an opportunity for his employer to increase sales. While it is unfortunate that Climate Change may cause greater suffering, his company is well positioned to address that and make profit from it, too. So for smart companies anticipating Climate Change effects, this can be a business opportunity, too.

I wish there was a quick fix or easy answer to address Climate Change and avoid the potential worst-case situation. In the absence of effective, focused global government action and despite the growing clamor “in the streets” by the public for solutions, the potential enormous risks of Climate Change – plus some potential opportunities – is now becoming a reality which the market and smart businesses will examine and use to their effectiveness and growth.

We hope this has given you some basic talking points to bring up the issue in your firm and begin the conversation. CCES has the experts to help assess Climate Change and potential risks and opportunities for your community and company. Contact us today at 914-584-6720 or at karell@CCESworld.com.