Researchers from the University of Cambridge are urging businesses to increase their resilience to prepare for extreme weather events caused by climate change.
Findings from the Cambridge Climate Change Business Risk index have shown that climate change could add around 20% to the global cost of extreme weather events by 2040.
The index is developed by the Centre for Risk Studies at the University, it incorporates climate model outputs to analyse the increasing risk of extreme weather events and their potential to disrupt business operations and supply chains globally.
The results show that extreme weather events will increase the reported losses from their present cost of £195bn a year, to £234bn a year by 2040.
For example, businesses in Chicago can expect a 50% chance of having an additional 20 days a year where temperatures will exceed 25 degrees, which will, in turn, reduce the productivity of employees.
The researchers behind this index are urging businesses to prepare for these losses, they have said that by accurately quantifying this information on a business-relevant timescale it will help businesses to plan and prepare for these climate-related risks.
Dr Andrew Coburn, chief scientist at the centre for risk studies said: ‘Companies are struggling to reconcile the long-range forecasts of the consequences of a warmer planet in several decades time, with weather changes that are already impacting their businesses in various ways, and how their business will be affected by the transitions that society is making today towards a low-carbon economy.’
In August 2019, academics from the University of Cambridge stated that virtually all countries – whether rich or poor, hot or cold – will suffer economically by 2100 if the current ‘business as usual’ approach to climate change continues.
The research published by the National Bureau of Economic Research suggests that on average – richer, colder countries would lose as much income to climate change as poorer, hotter nations, with 7% of global GDP disappearing by 2100 including over 10% of incomes in both Canada and the United States.
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