Global Assessment Report on Disaster Risk Reduction 2013
From Shared Risk to Shared Value: the Business Case for Disaster Risk Reduction

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Small and medium enterprises are particularly at risk: A single
disaster may wipe out all or large parts of business capital of small
enterprises, in turn affecting large companies relying on local suppliers. Yet,
than 15 percent of companies with less than 100 employees in disaster prone
cities in the Americas have a
business continuity or crisis management
plan in place (Chapter 11).
Disaster risk is a new multi-trillion dollar asset class: Global capital
flows have transformed the landscape of disaster risk, creating a new pile of toxic
assets for businesses and governments that do not currently appear on balance
sheets (Chapter 2). Globally, US$71 trillion of assets would be exposed to one-
in-250 year earthquakes. In Honduras, already a one-in-33 year disaster would
create a significant financing gap for the government with impacts on future GDP
(Chapter 5).
Most disasters that could occur haven’t happened yet: Total
expected annual global loss from earthquakes and cyclone wind damage
alone now amounts to
US$180 billion per year (Chapter 3). This figure does
not include the significant cost of local disasters from floods, landslides, fires and
storms (Chapter 4) or the cost of business interruption. Agriculture is also at risk:
in Mozambique a one-in-10 year drought would lower maize yields by 6 percent
and GDP by 0.3 percent (Chapter 6).
Risks to natural capital compromise future wealth: Disaster risks
include the loss and erosion of
natural capital with serious consequences for
business, households and a country’s wealth. For example,
wild-land fires
now affect all continents with global annual losses to tropical ecosystems alone
reaching US$190 billion per year (Chapter 6). Land degradation
increases agricultural drought risk; in Africa, the total area with high degradation
and high drought hazard is almost 260,000 square km.
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