Climate risk – Special report 2019

The past two full years – 2017 and 2018 – were the most costly back-to-back years on record for weather-related disasters say insurance companies, with economic losses exceeding $650 billion. Moreover, 2018 was the fourth costliest year on record for weather-related events. Experts believe 2018 represents a ‘new normal’, when a large number of relatively small natural disasters added up to substantial losses. 

Trying to ascertain how many of these events are the result of global climate change, and how many would have happened regardless, is extremely challenging, but historical data can certainly be applied to show that the frequency of severe weather events has increased in recent years.   

There is also widespread agreement that assessing and managing climate risk will require the co-operation of enterprise risk and business risk managers, but it will also require them to work alongside environmental and social responsibility teams. While climate risk is identified as a top risk at many firms now, it needs to move beyond the level of public relations and ethics to a quantifiable business risk that can be communicated in a transparent and standardised way.  

We hope this report provides invaluable information to companies as they embark on this journey. As ratings agency Standard & Poor’s noted at last year’s UN Climate Change Conference: “Climate change has already started to alter the functioning of our world.”

Download the full 2019 Climate risk special report in PDF format