According to the World Economic Forum, climate change adaptation is a market close to $2 trillion[1]. For this reason, the private sector can find a great opportunity in adaptation, not only reducing costs, but increasing productivity and improving its competitiveness. It is a strategic advantage that strengthens the value chain, benefits relationships with stakeholders and brings multiple opportunities.
This involvement can come from various mechanisms, not only through financing. This article presents some practical strategies that companies can implement to boost climate resilience.
1. Training and awareness of interested parties:
The first line of defence against the impacts of climate change is knowledge. The awareness of the company’s staff and suppliers plays an important role. It is crucial to train teams and external contractors in understanding sector-specific climate risks and managing impacts according to the location of the facilities and the resources or ecosystem services on which they depend. This not only strengthens internal resilience, but creates an organizational culture focused on sustainability. Thus, awareness programs, training sessions and educational tools can be implemented to foster staff understanding and participation in adaptation initiatives.
2. Participation in resilient business models:
Companies can innovate their business models to adapt to changing climate realities. This may include diversifying the supply chain, incorporating more resilient agricultural practices, or developing products and services that address the needs of communities affected by extreme weather events. Supporting ventures or start-ups that develop innovative climate solutions through investments, strategic partnerships or acceleration programs also contributes to this goal. This way, companies can leverage the creativity and agility of startups to address specific challenges related to climate change adaptation. By aligning business interests with climate resilience, companies not only protect themselves, but also contribute to the well-being of the communities in which they operate.
3. Investment programs in resilient communities:
The private sector can maximize its impact by targeting, directing and encouraging investments towards communities that are vulnerable to the impacts of climate change. It should be noted that this not only implies financial contributions, but also the development of programs that strengthen local infrastructure, emergency response capacity and education on climate risks, which will benefit the relationship of companies with these communities and, moreover, will improve business reputation. Companies can leverage their resources and experiences to improve the adaptive capacity of communities, building strong alliances and creating an environment conducive to sustainable and inclusive development.
4. Alignment with high climate resilience standards:
Aligning with specific standards or obtaining climate resilience certifications is a significant step for companies to demonstrate their commitment to adaptation in a transparent way. Examples of this are internationally recognized certifications, such as ISO 14090 (Adaptation to Climate Change) or ISO 14001 (Environmental Management), and standards such as the Task Force on Climate-related Financial Disclosures (TCFD) and the Taskforce on Nature-related Financial Disclosures (TNFD). Embracing and implementing the guidelines of these standards helps establish clear parameters and improves the credibility of companies in terms of sustainability and resilience.
5. Nature-based Solutions (NbS):
Finally, Nature-based Solutions (NbS) stand out as a valuable alternative to address the challenges of climate change. Companies can explore integrating NbS into their business strategies, strengthening their adaptation through initiatives such as ecosystem restoration, sustainable forest management, integrated watershed management and the promotion of regenerative agricultural practices. This way, by collaborating with experts in multiple disciplines and drawing on the knowledge of local communities, companies can strengthen their own operations and contribute to a more resilient future without abandoning their competitiveness.
Many companies already invest in adaptation inadvertently when, for example, they implement measures to prevent or minimize economic losses associated with floods or droughts, among other factors that threaten their productivity. However, according to the Adaptation Gap Report 2023, estimated adaptation needs (between $160 billion and $340 billion by 2030) are five to ten times higher than international adaptation finance flows.
In this context, there is a great opportunity to increase the intentional, planned and effective participation of companies to adapt to the present and future challenges of climate change, with benefits for the sector itself, society and nature.
Special thanks to Santiago Núñez, private sector specialist, and
Angela Prías, climate change adaptation specialist.
References:
[1] https://www.weforum.org/agenda/2022/11/climate-change-climate-adaptation-private-sector/
