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Business areas and future climate BACLIAT workshop
Climate change as a business risk • Weather already frequently causes business disruption and in some cases has an influence on productivity and sales. • Climate change will lead to a wide range of threats and benefits, both of which could present business opportunities. • The business case for building resilience to the changing climate can be made in terms of avoiding unexpected costs, managing risks and making the most of opportunities. • The consequences of climate change are very business and sector specific – in order to make a business case for taking action, we need to explore all the ways in which climate change could affect us.
We are not alone “The issue of expertise in relation to climate change is now embedded within the organisation’s strategic plan and we are in a better position to act as a well informed and trusted source of information and guidance to our members. ” Vic Crisp, Chartered Institute of Building Services Engineers “There are niche markets in helping others to identify and adapt to the risks from climate and environmental change. These can often be a development from an established service rather than a totally new departure. ” Mike Samuels, Owner of Medical Photographic Services (SME)
Work to date • [either delete this slide or complete as appropriate e. g. with the outputs of any previous workshop, sector/ business specific information, such as your reasons for carrying out this work or background research]
The purpose of today’s workshop • Today’s workshop will draw upon your knowledge of your organisation to brainstorm potential future impacts of climate change. • We will use UKCIP’s BACLIAT workshop (business areas climate assessment tool). • The idea is to uncover all the potential impacts without making any judgement on how likely an event will be (identifying significant impacts or prioritising can be part of a future exercise). • The only climate information we will be using are headline messages.
Expected changes in the UK Changes in annual / seasonal averages • higher average temperatures, particularly in summer and winter • changes in seasonal rainfall patterns • rising sea levels Changes in extremes • more very hot days and heatwaves • more intense downpours of rain • higher intensity storms Website: http: //ukclimateprojections. defra. gov. uk
BACLIAT – Business Areas Climate Assessment Tool A generic framework for considering climate impacts on business areas: • markets • logistics • process • finance • people • premises Climate change provides both threats and benefits
Markets Changing demand for goods and services: • tourism: Mediterranean is too hot, so visit UK instead • food & drink: summer preferences, al fresco pavement cafes 24/7 • leisure: demand for parks, gardens, heritage • building design: passive cooling, sustainable construction • technology: monitoring, flood protection, cooling equipment, health products etc. • global impacts on markets or supply chains
Logistics • Disruption of supply chains arising from: – transport disruption – impacts on suppliers • Just in time systems increase vulnerability • Disruption to power or water supply • For smaller companies, supply chains and power supply represent a large proportion of their exposure to the climate risk. Summer 2005: BMW lost hours of production equating to 50 cars as a result of delays to deliveries following riverine flooding
Process Impacts on production processes and service delivery: • some business processes, equipment, assets and activities are temperature sensitive: - food preparation and storage - some industrial processes, such as waterless printing - agriculture - IT server room • extreme events can cause damage or disruption • climate change could reduce / increase production efficiencies • extreme events will set new performance standards
People Implications for employees and customers: • poor or better working environment? - external: construction, agriculture - internal: offices in summer - more complaints generally • reputation as employer - attract and retain high quality staff
Premises • Impacts of wind, rain, storm, fire and subsidence on building fabric and structure or grounds • Internal environment: less winter heating/ more summer cooling • Design decisions based on historical climate data likely to be inadequate • Retrofitting existing buildings represents a major challenge • Sustainable construction needs to link climate change adaptation and mitigation agendas
Finance • Insurance issues: increased premiums; variable premiums; vulnerable locations; uncertainty • Investment issues: tests for future proofing of investment, global impacts on international investment • Costs: impact on raw material prices; retrofitting existing buildings and equipment could be expensive
Expected changes in the UK Changes in annual / seasonal averages • higher average temperatures, particularly in summer and winter • changes in seasonal rainfall patterns • rising sea levels Changes in extremes • more very hot days and heatwaves • more intense downpours of rain • higher intensity storms
Next steps Following this workshop we will: • Re-write each impact so that it is clear what the climate driver is, where the impact will be felt and what the business consequences are. • Discard the BACLIAT headings in favour of a structure that fits with your organisation, if you have not already done so. This allows risks to be assigned to the appropriate staff and be involved in further discussions. • The workshop may be used as part of a more rigorous approach to developing an adaptation plan or strategy, for example by using the UKCIP Adaptation Wizard (www. ukcip. org. uk/wizard/).
Thank you for taking part www. ukcip. org. uk