A comprehensive climate risk management strategy is essential. The effects of human action-driven climate change are eroding the progress made towards achieving the UN’s Sustainable Development Goals (SDGs). Extreme weather events like cyclones, floods and heatwaves are rapidly increasing in rate and severity. At the same time, there are slow-onset events.
Climate risk management is essential to mitigating extreme weather events. Source: Pixabay
Defining climate risk management
So, how do we mitigate these climate risks? To address these threats, they need to be identified and assessed. It is then that the current and future climate-related risks need to be analysed to develop measures to prevent and reduce their impacts. Thereafter, strategies need to be put in place to handle the uncontrolled risks and be able to proactively respond to disasters, curtailing further losses and damages.
Comprehensive Climate Risk Management (CRM) is a systemic framework that seeks to anticipate, avoid and prevent all types of climate risks, as well as to absorb remaining impacts from extreme weather events and slow-onset changes. Thereby, it integrates the two research strands of Climate Change Adaptation (CCA) and Disaster Risk Reduction (DRR) into a sustainable development framework.
Response measures to combat climate events mainly include adaptation and mitigation. Adaptation refers to acting appropriately to avoid or reduce the harmful effects of potential climate risks. Alternatively, it also involves utilising the opportunities it may present. This entails structural reform at a national level- especially for developing countries. In turn, this will embed climate risk management into their plans and policies.
Futhermore, an increase in opportunities will become available in the policy space to transform and build resilient economies. Building defences to guard against a rise in sea level and broad modifications to infrastructure are useful. Even diversifying into various sectors instead of relying on a few climate-sensitive sectors is another instance. Local authorities can also install effective draining pavements to manage floods and stormwater and enhance water storage and use.
Concurrently, mitigation is about reducing the adversities of the climate crisis. This can halt or cutgreenhouse gas emissions that pollute the atmosphere. An example is to allocate finances to develop a diverse low-carbon economy. This has to be fuelled by renewable energy sources and green technologies. This is a form of mitigation as well as an adaptation strategy. Forestation, protecting and increasing mangroves, and building more sustainable transport (like electric vehicles) are also effective mitigation approaches.
What are the economic impacts of climate disasters?
The socioeconomic impacts of climate change and disasters are immense. Approximately 3.3 to 3.6 billion people live in situations that imminently expose them to climate change. This is roughly 40% of the world’s population. People who live in high-risk areas for climate events like low-lying coastal regions, high mountain areas and in the Arctic have become more risk averse. This is mainly due to the recurrent loss of lives and destruction of assets and properties. Because of this, people become reluctant to invest in resources that benefit human well-being, favouring humans economically.
Similarly, when a country diverts its capital to provide relief for recovery and rebuilding actions, it deprives the opportunity of allocating these funds to economic development. Being exposed to climate risks in susceptible circumstances, along with inadequacy to moderate or manage the adverse impacts leads to disasters and losses. Climate change adversely affects developing economies and emerging market economies. These nations are the least equipped to face these consequences.
Inaction has already cost developing nations a two-fold increase in adaptation expenses in the last ten years. These costs will potentially rise with surging global warming, hitting $300 billion in 2030 and $500 billion in 2050. Hence, climate risk management is fundamental to development. Identifying and lowering the climate risks can save lives, livelihoods, and possessions, thus fostering development. Identifying and lowering the climate risks can save lives, livelihoods, and possessions, thus, fostering development.
Extreme destruction calls for climate risk management. Source: Pixabay
International climate risk management Policies and Agendas
The Paris Agreement, adopted in 2015, is a landmark binding agreement. It aims to limit global warming well below 2°C (which is above pre-industrial levels). The new target is to restrict the global average temperature rise below 1.5°C. This is as the UN’s Intergovernmental Panel on Climate Change (IPCC) denotes that exceeding it can worsen climate risks. It also stresses that the past greenhouse emissions alone will not push global warming at about 1°C currently above pre-industrial levels, further by another 0.5°C. So, achieving this target is possible by zeroing these emissions immediately. Accordingly, to attain this target, the maximal greenhouse gas emissions must be reached by 2025 at the latest, and decrease 43% by 2030.
Greenhouse emissions are the main reason for climate change. Source: Pexels
Climate risk management through adaptation
Similarly, the Sendai Framework for Disaster Risk Reduction (United Nations Office for Disaster Risk Reduction, UNDRR), was adopted in 2015. It prioritises activities to avert future risks and minimise current disaster risks. Its four action-oriented priorities include understanding disaster risk and building up risk governance. The third priority is to invest in ways to reduce disasters to improve adaptability. The final priority is to advance disaster proactiveness to respond better, and to “Build Back Better” in recovery, rehabilitation and reconstruction. The goal is to tremendously dampen the catastrophic impacts of disasters by saving lives, livelihoods, and properties. The goal also aims to protect the environment and economic systems.
Aligning adaptation and disaster risk reduction through data
Furthermore, many challenges are hindering its implementation. There is a lack of knowledge, inconsistent interpretation of climate risks, restricted expertise in incorporating climate information into risk reduction strategies, and promoting climate adaptation practices. Besides, other concerns include fragmented institutional systems and funding. Nevertheless, it is pivotal to implement integrated planning as otherwise it can exacerbate the climate crisis.
UNDRR’s Comprehensive Disaster and Climate Risk Management (CRM) Source: UNDRR
Residual climate risk management
Despite several effective climate policies, the consequences of climate change impacts and the potential loss and damage from these events, still pose a risk. As per IPCC, 2019, residual risk is the risk that remains, following adaptation and risk reduction efforts. To address this residual risk GIZ’s Global Programme on Risk Assessment and Management for Adaptation to Climate Change (Loss and Damage) (GP L&D) has built a climate risk management (CRM) framework to prevent, reduce, and tackle losses and damages. Thus, the idea of CRM consists of the below mutually reinforcing steps, and it is essential that all the relevant stakeholders from various sectors and levels take part in the formulation of the CRM.
Climate risk management is a decent way to address the future. Source: Adaption Community
Climate risk financing and insurance
The framework intends to deal with and decrease the ramifications of climate change by avoiding climate risks by minimising greenhouse gas emissions. This is the best possible mitigation approach. Similarly, it aims to reduce climate risks via adaptation, and risk management. Meanwhile, it also addresses residual climate risks through instruments like climate risk funding or transformative measures such as livelihood diversification. For instance, crop and income diversification are exceptional ways to cope with risk and deal with economic and climate shocks to advance livelihoods.
In a similar vein, Global Shield against Climate Risks is a G7 initiative that was officially launched at the COP27 climate conference in 2022. This was established along with the Vulnerable Twenty (V20), which is a group of high-risk nations. The aim is for the industrialised nations to provide easy and quick access to support the poor and vulnerable people and establishments from developing countries during climate emergencies. This will cut disaster effects, save lives and livelihoods, protect the resilience of the economies of these countries, and sustain any progress made. Accordingly, the Shield consolidates acts associated with climate risk financing and a proactive approach through preparedness under one roof.
why Is it essential that we focus on Climate Risk Management?
The temperature rise beyond 1.5 C will elevate disaster risks that can be uncontrollable and more frequent. Extreme climate events have increased twofold in the last two decades compared to the former two decades. Climate change also generates slow-onset environmental alterations like increasing sea levels, groundwater salinisation and worsening desertification. These disasters lessen the capability of climate change adaptation. These adaptation solutions refer to changes in processes and systems in devising action plans to respond to the effects of current and potential climate change. Meanwhile, if risk is excluded from these adaptation strategies then it can give rise to new threats and lead to ineffective adaptation.
The IPCC reports highlight that climate change has altered several oceanic ecosystems in addition to affecting flora, fauna and humans. The Special Reports on Global Warming of 1.5°C has particularly emphasized that confining global warming to 1.5°C can possibly save hundreds of millions of humans from becoming re-impoverished.
Women and girls rely more heavily on climate-sensitive sectors like agriculture- especially in low and lower-middle-income countries. To earn a higher income during these tough times, it has become common for girls to drop out of school to support their families. It is then that the climate crisis acts as a threat multiplier and magnifies the prevailing gender inequalities. This further exacerbates the unique risks to female livelihoods, health, and protection against violence, trafficking and child marriage. Consequently, women and girls are the most affected by climate change.
moving forward
Finally, there is undoubtedly an urgent call to implement the tried and tested climate risk management strategies based on the best available scientific knowledge. A tremendous transformative outlook to climate adaptation, backed by extensive public financing and green industrial practices is pivotal in this fight against climate risks. This will climate-proof the existing and future climate threats, creating job opportunities and fostering economic development.
Interactions among the coupled systems are the basis for climate risks and offer opportunities to manage climate change. Source: IPCC
THRIVE advocates for the mitigation of climate change and provides scientifically informed solutions through research, to educate the people to not only survive the climate crisis, but to thrive beyond through adaptation and mitigation strategies, aligned with international frameworks.
A THRIVABLE Framework
At its core, ‘sustainability’ is simply defined as the ability to continue to survive. ‘Thrivability’, by contrast, is the next step, beyond sustainability. THRIVE believes that humanity can do better with the knowledge currently available to us. We want to instil the idea that sustainable solutions not only prevent disaster, but offer the potential for societies to flourish.
The THRIVE Framework examines issues and evaluates potential solutions in relation to this overarching goal of thrivability. It is about making predictive analyses using modern technology that supports environmental and social sustainability transformations.
We recognise that human happiness can sometimes compete with environmental well-being, which is why we use our ciambella chart to illustrate the ‘thrivable zone’. This is the area between a ‘social floor’ (the minimum required for people to be content in their everyday lives) and an ‘environmental ceiling’ (the maximum damage that we can do to the environment before it becomes unsustainable). Overlaid on these thrivable zones are visual measurements that show impact – whether something is inside the thrivable zone – or exactly where it falls short.
To learn more about how The THRIVE Project is researching, educating and advocating for a future beyond sustainability, visit our website. You can follow our informative blog and podcast series and learn about our regular live webinars featuring expert guests in the field. Sign up for our newsletter to receive regular updates.
A postgraduate currently reading for Master of Management in Finance and Investment from Wits Business School, in South Africa. A financial professional who is a Certified Practising Accountant of CPA Australia and a Chartered Management Accountant (UK). Professional experience includes Financial Planning and Analysis in a global Information Technology firm and, in Risk Management in the banking sector.A multidisciplinary with an undergraduate degree in Bachelor of Science with main focus on Mathematics and Computer Science. Passionate about promoting sustainability and thriving for constant advancement.
HREC Approval Number: H20REA044
Project Title: Assessing the strong sustainability performance of organizational business models
Principal (Student) Researcher: Mr. Mauro Dino Fedeli
Other Researcher(s): Prof. Patrick Danaher, Dr. Anup Shrestha; Dr. Paul O’Brien
I have read the Participant Information Sheet, and the nature and purpose of the research project have been explained to me. I understand and agree to take part.
I understand the purpose of the research project and my involvement in it.
I understand that I may withdraw from the research project at any stage and that this will not affect my status now or in the future.
I confirm that I am over 18 years of age.
I understand that, while information gained during the study may be published, I will not be identified, and my personal results will remain confidential unless I authorize otherwise.
I understand that, I must not disclose information during the project that is confidential, subject to legal professional privilege, or which might amount to a breach of applicable anti-discrimination legislation or rules or principles of legal professional conduct.
I understand that I will be video recorded during the study unless otherwise agreed. I understand that the recording will be kept for back-up purposes. I understand that hardcopy documentation related to me and data collected in electronic form will be stored on a password-protected computer and/or storage device.
Name of participant __________________________________
Signed ___________________________ Date _____________
If you have any ethical concerns with how the research is being conducted or any queries about your rights as a participant please feel free to contact the University of Southern Queensland Ethics Officer on the following details.
Ethics and Research Integrity Officer
Office of Research and Higher Degrees
University of Southern Queensland
West Street. Toowoomba 4350
Ph: +61 74631 2690
Email: ethics@usq. edu.au
Participant Information Sheet
HREC Approval Number: H20REA044
Project Title: Assessing the strong sustainability performance of organizational business models
Principal (Student) Researcher: Mr. Mauro Dino Fedeli
Other Researcher(s): Prof. Patrick Danaher, Dr. Anup Shrestha; Dr. Paul O’Brien
I would like to invite you to take part in this research project which has two key objectives:
a) To develop a science-based sustainability performance assessment tool to guide entities towards a
thrivable future; and
b) To evaluate the effectiveness of the tool by evaluating an operationalized online software implementation
against other relevant approaches.
1. Procedures
Participation in this project will involve being recorded about:
(a) How was your experience regarding the utility of the assessment tool; and
(b) How do you perceive the usefulness of the tool in making decisions compared to other qualitative manual
sustainability assessment methods?
Other important information and procedures about your participation in this research project:
• You will be answering questions based on your expertise in the relevant field (business modeling, management strategy, sustainability metrics).
• The process will involve a session of approximately 60—90 minutes in duration that will be video recorded. Afterwards, you will be able to access the recording so that you can verify the accuracy of its contents and change/add to your responses.
• The video recording and subsequent (partial) transcripts will be kept confidential. Data obtained will be de-identified before they are presented so that your responses cannot be personally identified.
• Please note, however, that, although your responses will be confidential and your responses deidentified before these responses are analysed, you must not disclose information that is confidential, or subject to legal professional privilege. You also must not disclose information that might amount to a breach of anti-discrimination legislation, or of the rules and principles of professional conduct.
• It is hoped that this research benefits participants by giving them early access to sustainability performance tool and measures, and by critically identifying which organizational business models are associated with sustainable enterprises.
• It is further expected that this research will also be of benefit to the wider community by contributing to an understanding as to which business models are more successful than others. It is entirely at your own discretion should you wish to follow the recommendations provided by the tool in order to improve your own endeavours to become more sustainable.
The research has been approved, and will be monitored by, the University of Southern Queensland’s Human Research Ethics Committee. If you have any questions or concerns about the research at any time, you can raise them with the Ethics Officer using the contact details set out below.
2. Voluntary Participation
Participation is entirely voluntary. It you do not wish to take part then you are not obliged to do so. If you decide to take part and later change your mind, you are free to withdraw from the project at any stage. Any information already obtained from you will be destroyed, whilst it remains in identifiable form. Once the data have been de—identified, however, it will not be possible to withdraw the data. To minimise any risk to you, you will be provided with access to the answers, and given the opportunity to verify, clarify and update the same.
Please notify the researcher if you decide to withdraw from this project at any stage. A list of counseling services is provided online and include: Lifelong in Australia; Crisis Services Canada in Canada; La Croix Rouge Ecoute in France; the Samaritans in the United Kingdom; and Samaritans USA in the United States. Further information about the project is available at the website www.blog.strive2thrive.earth.
Should you have any queries regarding the progress or conduct of this research, you can contact the principal
researcher:
Mr. Mauro Dino Fedeli
School of Management & Enterprise, Faculty of Business, Education, Law and Arts,
University of Southern Queensland, Toowoomba QLD 4350
Contact: +61 419 577 377, email: morris@blog.strive2thrive.earth
If you have any ethical concerns with how the research is being conducted or any queries about your rights as a participant please feel free to contact the University of Southern Queensland Ethics Officer on the following details.
Ethics and Research Integrity Officer
Office of Research and Higher Degrees
University of Southern Queensland
West Street. Toowoomba 4350
Ph: +61 74631 2690
Email: ethics@usq. edu.au