As the world continues to battle the COVID pandemic, insurer Zurich Municipal has issued a new white paper which urges business to ensure the fight against climate change is not ignored.
The underwriter has published the white paper which examines the issues and proposes three core actions to ensure future business resilience.
“As a global insurance business, Zurich has witnessed more extreme weather and climate related events – and the increased costs,” it said. “In 2019, hurricanes, wildfires and floods cost the world $150 billion. Yet even these catastrophic events do not fully express the extent of environmental risk facing the world today.”
The insurer advocates three crucial steps for organisations to develop a climate resilience adaptation strategy:
- Identify the broad organisational and strategic risks – understand where your vulnerabilities are and your exposure to hazards, or risk triggers;
- Develop a granular view of the risks involved – involve modelling of both physical and transition risk impacts; like individual locations, or specific activities, including services and outputs;
- Develop a mitigation strategy – involve insurance if appropriate. Develop resilience strategies, either through physical risk adaptation, or by changing business models and activities to address transition risks.
Andrew Jepp, (pic) Managing Director, Zurich Municipal said: “We are facing up to the immediate challenges of a global emergency. The climate change emergency. While the COVID-19 pandemic is urgent and immersive, it is not the only global emergency public service organisations are acting on now.
“Over the past year many aspects have shifted rapidly: particularly policy-making and public sentiment. All organisations are now considering the climate impact of decisions and are developing holistic strategies to build resilience.
“Organisational culture should embed de-carbonising services, building resilience and managing physical risks. We have to respond well to extreme events through consistent, effective recovery plans.”
In his forward to the white paper Mr Jepp said 2020 remains critical for making progress on climate change.
“The cost of inaction far exceeds the cost of action,” he added. “We want this whitepaper to start a conversation in all organisations on what is being done, and what can be done, to manage this risk and address the human and environmental impacts of climate change.
“Globally 2019 was the second-hottest year on record. From the extensive wildfires in Australia, to devastating flooding in Britain, the manifestations of climate change are evident and are continuing in 2020.”
He continued: “Today’s risks must be considered, but just as important are those of tomorrow and what may emerge in the future. It is difficult to plan thirty years ahead, but all climate change strategies require advanced thinking well into this century.”
Mr Jepp said climate change related risks remain dynamic. Over the past year many aspects have shifted rapidly: particularly policy-making and public sentiment.
“We have to respond well to extreme events through consistent, effective recovery plans. Zurich is a company with sustainability at the heart of its business. Within our organisation we make a difference through our responsible investment approach and we are swiftly reducing our carbon footprint. We are proud to be the first insurer to commit to the UN Global Compact’s Business Ambition for 1.5°C. We work with our customers to enable them to respond to the climate agenda through risk reduction, preparedness and resilience.”