* Any views expressed in this opinion piece are those of the author and not of Thomson Reuters Foundation.
Surging climate-related disasters now demand an entirely new approach to understanding and acting on climate risk
As world leaders prepare to meet in Glasgow later this month for the COP26 climate change conference, they must also recognize that climate-related disasters now demand an entirely new approach to understanding and acting on climate risk.
The Environmental Protection Agency expects weather-related disasters will occur with increased frequency due to climate change. Re-insurer Swiss Re estimates that climate change could strike a $23 trillion blow to the global economy by 2050.
A consensus is emerging among governments and large, institutional investors that our risk exposure to climate change-driven disasters will continue to grow exponentially.
Rather than look to the past, we need to model the future. We must mitigate climate threats and their ripple effects on businesses and communities, rather than scramble to react after the damage has been done.
And we need to push for disclosure of all risks associated with climate change, especially given the mounting risk to people and lower-income communities.
Technology can be the foundation of our collective solutions. Artificial intelligence and machine learning today are capable of creating digital twins of our communities to model, understand and get ahead of climate risks.
We now have the power to granularly map cities block by block, capturing every power base station, water pipeline, bridge and port. Armed with better data and AI, we’re able to run thousands of climate simulations before a natural disaster hits to identify vulnerable communities and critical infrastructure in harm’s way. We’re able to measure resilience using data like never before.
Scientific and technological advancements like these make it possible to engage in regular scenario analyses to determine vulnerabilities and where an organization should direct its efforts to improve its resilience.
And since companies can now meaningfully identify these risks, the C-suite has no choice but to disclose them and the threats they pose to physical assets, operations, and market values—as well as the communities increasingly impacted by disastrous events.
Beyond market cap concerns, climate risk directly impacts the U.S. military readiness and national security. For many private companies that serve the Department of Defense, downtime or damage to their facilities and supply chains can leave the military unprepared in a crisis.
Remember that in 2018, after Hurricane Michael hit Florida, Tyndall Air Force Base couldn’t bring all of its operations back or find housing for its personnel in the hard-hit local communities, jeopardizing our national security.
We need to take care of people, not just buildings and the planet. By equipping our communities, companies and institutions with resilience data, we can make a difference in the lives of lower-income and underrepresented communities, which tend to be older or not built to code.
Those who died in the recent New York floods primarily drowned in illegal basements, an issue exacerbated by a lack of affordable housing. But if we focus on early detection that factors in these gaps in resilience, we can understand the threats and act faster to save lives.
Congress can do its part via tax credits and regulatory actions to push the private sector into doing more to build resilience. Achieving a holistic view into climate resilience and risk will require increased private-public sector collaboration, greater access to data, better probabilistic modeling to understand climate threat scenarios, and transparent and accurate risk disclosures.
Whether it's safeguarding electric power and water sources or understanding how a disaster might affect the flow of vehicle traffic or supply chains, governments and private enterprises must identify the previously "unknown unknown" variables of a disaster event.
Climate change is here. And with weather-related disasters nowadays consistently setting records, it's no longer credible to claim we can't have foreseen an extreme event or its precise, devastating impacts. We need to not only race to zero emissions, but also zero vulnerabilities by investing in climate resilience.