By Alicia Sieger, Kate Brandt, & Kate Randolph
If you Google “cost + climate change,” you’ll get a range of estimates, all in the trillions. If you try searching for “how much private companies are investing in climate resilience,” you’ll get an even wider range of results. Meanwhile, Mother Nature is busy plotting the cost of inaction. The number of natural catastrophes worldwide—and the economic losses resulting from them, most of which aren’t insured—has increased significantly since the 1990s. During the previous 35 years, the average number of billion-dollar weather disasters in the United States was about five per year. In 2016, there were 15 weather and climate disaster events with losses exceeding $1 billion each in the United States alone.
Rising seas, more powerful storm surges, droughts, floods, and extreme heat all damage livelihoods, assets, and the economy—and they are expensive to fix. Investors and underwriters have taken notice and are increasingly demanding data on the climate risk of their assets. Last month, the world’s largest asset manager, BlackRock, listed climate risk as one of its top “engagement priorities.” Meanwhile, forward-thinking companies are keen to advance market reporting and disclosure mechanisms that will reward them for investing in assets and strategies that can weather a changing climate.