Executive Briefings

Supply Chain Companies Anticipate Risks Against Revenues Resulting from Climate Change

Seventy percent of companies believe that climate change has the potential to affect their revenue significantly, according to a new report by the Carbon Disclosure Project (CDP) in partnership with Accenture.

The report is based on information from 2,415 companies, including Dell, L'Oreal and Wal-Mart. Encompassing 2,363 suppliers and 52 major purchasing organizations who are CDP Supply Chain program members, the respondents include and represent a combined spending power of $1tr.

Findings highlight the near-term risks that climate change presents to businesses. According to the report, 51 percent of the risks that disclosing companies associate with drought or extreme rain are already having an adverse effect on company operations, or are expected to within five years.

Additionally, the destructive nature of extreme weather is likely to act as a catalyst for company action on climate change, with physical climate risk identified in the report as a greater driver of investment than climate policy. Of the 678 companies investing in emissions reduction initiatives, three quarters (73 percent) say they feel that climate change presents a physical risk to their operations; just 13 percent identify regulation as a sole driver.

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The report is based on information from 2,415 companies, including Dell, L'Oreal and Wal-Mart. Encompassing 2,363 suppliers and 52 major purchasing organizations who are CDP Supply Chain program members, the respondents include and represent a combined spending power of $1tr.

Findings highlight the near-term risks that climate change presents to businesses. According to the report, 51 percent of the risks that disclosing companies associate with drought or extreme rain are already having an adverse effect on company operations, or are expected to within five years.

Additionally, the destructive nature of extreme weather is likely to act as a catalyst for company action on climate change, with physical climate risk identified in the report as a greater driver of investment than climate policy. Of the 678 companies investing in emissions reduction initiatives, three quarters (73 percent) say they feel that climate change presents a physical risk to their operations; just 13 percent identify regulation as a sole driver.

Read Full Article