Delve into the types of data essential for companies to track their adaptation efforts and the tools employed to manage climate change adaptation effectively.
The increase in the rate of occurrence of extreme climate events, such as the wildfires in Australia in 2022 and the Emilia Romagna flood of 2023, reminds us that while we are trying to understand how to approach sustainable development, climate change is already manifesting its effects.
To add flavour to the argument, climate change mitigation actions and regulations are not performing well enough to tackle the long-term effects of climate change, as stated by IPCC Chairman Jim Skea said: “If we do not act now, we close the option of limiting global warming to 1.5°C as we will have used up the carbon budget by the end of this decade, even with the current set of nationally determined contributions.”
In this context, Climate change adaptation concepts and actions are becoming a central element in a company's ESG strategy.
Climate change adaptation refers to the process of adjusting to the current or expected effects of climate change to minimize harm or exploit beneficial opportunities.
On the regulatory spectrum, with climate change adaptation being one of the six objectives of the European Union Taxonomy on Sustainable Activities, providing businesses with adaptation strategies and tangible actions to curb the risks of climate change and ensure compliance with regulatory demands has become imperative.
To do so, businesses need to integrate a data-driven approach to climate adaptation strategies that address the multifaceted aspects of climate change while aligning with global sustainability objectives.
Essential Data and metrics to track Climate change adaptation efforts
To track climate change adaptation effectively, businesses need to focus on collecting and analyzing a multitude of data whose assessment can represent a complex endeavour for a company approaching climate adaptation for the first time.
Firstly, businesses must gather comprehensive environmental data that goes beyond traditional metrics. This includes monitoring the resilience of their operations and supply chains to climate-related risks, such as extreme weather events or changing weather patterns by incorporating climate scenario data into a company risk management framework.
To do so, companies can leverage different data types and sources such as:
- Climate data and climate scenarios (e.g. European Climate Data Explorer, Copernicus Climate Change Service, IPCC Interactive Atlas);
- Event databases and socio-economic data (e.g. DRMKC Risk Data Hub);
- Climate change impacts projections (e.g. PESETA IV);
- Socio-economic scenarios (e.g. the Shared Socio-economic Pathways applied in the IPCC AR6).
Moving on, Social data points also plays a crucial role.
Social data should include assessments of how climate change impacts employees and communities and how adaptation measures address these challenges. For instance, evaluating how well a business supports its workforce in adapting to climate-related disruptions can provide insights into its long-term sustainability and resilience.
On the other hand, Governance data are critical for demonstrating compliance with the EU Taxonomy adaptation criteria. This includes evidence of a company's commitment to climate risk management and adaptation through its policies, governance structures, and strategic planning.
Furthermore, businesses should document their investments in adaptation measures, demonstrating how these initiatives contribute to the broader goal of climate resilience.
Tools for Managing Climate Change Adaptation
To facilitate the collection, tracking, and management of climate adaptation data, businesses can leverage a variety of tools and instruments designed to gather accurate and relevant data, analyze it for insights, and make informed decisions to enhance their climate resilience.
One key tool is given by climate risk and adaptation assessment software, which allows companies to identify and analyze the physical risks they face due to climate change. These platforms can help businesses assess the vulnerability of their operations and supply chains to various climate scenarios, enabling them to prioritize adaptation measures effectively.
Nonetheless, Data analytics platforms play a crucial role in processing and interpreting the vast amounts of environmental, social, and governance data related to climate adaptation. These platforms can integrate various data sources, providing companies with a holistic view of their climate risks and adaptation efforts and enabling businesses to identify patterns, trends, and insights to inform strategic decisions and operational adjustments.
Another essential set of tools that merge physical impacts to specific regions are the Geographic Information Systems (GIS) which are instrumental in visualizing climate risks and adaptation strategies, especially for companies with geographically dispersed assets. GIS can map and analyze environmental data, helping businesses understand how climate change might impact different locations and assets as well as to plan their adaptation measures accordingly.
Finally, reporting and disclosure tools are essential to ensure compliance with the EU Taxonomy and other regulatory frameworks. These tools assist companies in compiling and presenting their climate adaptation data in accordance with the required standards, ensuring transparency and accountability in their sustainability reporting.
Conclusions
As enterprises continue to navigate their sustainability journeys, the critical integration of climate adaptation strategies with ESG frameworks stands out as a fundamental imperative. This cohesive approach is critical in ensuring that organizations are not merely reactive to the challenges posed by climate change but are proactively positioned to secure sustainable growth in an era marked by uncertainty.
By fostering a data-driven approach to climate change adaptation, businesses will enhance resilience and their commitment to fostering a sustainable development that considers the inevitable consequences of climate change.
