CEOs are not prepared for climate change
A new study from insurance group FM Global suggests that more than three-quarters of CEOs and CFOs at major international firms have not prepared for the adverse effects of the environmental crisis
Of the CEOs and CFOs surveyed for the report, 77 per cent said that their organisations were not prepared for the full impact of the climate crisis, and a rather terrifying 82 per cent expressed the belief that their companies would have some to no control over such impacts. Seventy-six per cent admitted that their organisations were between ‘somewhat’ and ‘significantly’ exposed to climate risk, with floods, droughts and wildfires listed as the most concerning exposures that could potentially have a negative impact on financials.
FM Global pointed to a survey undertaken by the World Economic Forum shortly before the Covid-19 pandemic began to make its presence felt, the findings of which support the supposition that extreme weather events and other risks related to climate change will be the top concerns for businesses over the coming decade. This report is further fuel to that fire, no pun intended. And earlier this year, ITIJ reported on the latest Allianz Risk Barometer, which found that climate change is more of a concern than ever for global business.
“Unfortunately,” said Katherine Klosowski, Vice-President and Manager for Natural Hazards and Structures at FM Global, “these are difficult times for many companies, as they struggle with volatile financial markets and the threat of economic recession, coupled with the fact that Covid-19 may create further challenges when preparing for natural hazards.
“Fortunately, the majority of climate-related losses are preventable, highlighting how important it is to build business resilience – particularly during the pandemic. In the current crisis, achieving resilience may take more effort given the complexities [of] Covid-19, but it is possible. Lack of preparation could have a negative impact on already fragile bottom lines.”
The survey took in responses from 150 CEOs and 151 CFOs from North America, Europe, and the Asia-Pacific.