5. Business Impacts Assessment Technique

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A changing climate for business Horizon South
West Exeter, July 2005
Gerry Metcalf Knowledge Transfer Manager UK
Climate Impacts Programme
www.ukcip.org.uk
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UKCIP

• the UK Climate Impacts Programme (UKCIP)
• helps organisations to assess how they might be
  affected by climate change, so that they can
  prepare for its impacts.
• focus is on adaptation but takes account of
  mitigation
• set up by UK Government in 1997
• funded by Defra based at Environmental Change
  Institute, University of Oxford new contract
  through to 2010.
• stakeholder-led research, partnerships,
  programmes and capacity building
• uses common tools and datasets. All free!
• website www.ukcip.org.uk

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introduction

• Twin approach to Climate Change both adaptation
  and mitigation
• Adaptation is Cinderella of climate change
  agenda
• Adaptation in business is easier if adaptive
  capacity is present
• Rich climate scenarios data are available but
  KISS approach helps to avoid confusing science
  for many stakeholders
• Climate impacts potentially affect all business
  areas of an organisation
• A few business sectors are now addressing climate
  impacts
• More work is required to understand local impacts
  and evidence from recent weather related events.
• UKCIP resources to help business and business
  support organisations

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outline

• Science, evidence of climate change responses
• Climate change scenarios for UK over 21st Century
• Impacts of climate change on different business
  areas
• UKCIP resources and support

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Climate Change science, evidence of a changing
climate societys influence and strategic
responses
climate change is committed through to the 2040s
whatever mitigation actions we undertake now
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climate change some definitions

• climate average weather over a thirty year
  period
• climate change continuous pattern of change
  over geological time arising from natural
  causes
• climate change is now used more casually to refer
  (only) to the recent changes in climate that have
  been observed since the 1960s
• Climate post-1960 is changing faster than before.
• This is judged to be as a result of human
  activity which is increasing the socalled
  greenhouse effect

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variations of Earths surface temperature source
IPCC
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Scenarios based upon different GHG emissions are
all fairly consistent up to the 2040s source
Hadley Centre
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mitigation and adaptation

• mitigation of climate change
• slow down global warming by reducing greenhouse
  gas emissions
• adaptation to climate change
• respond to the anticipated impacts of climate
  change

note this language not very helpful but it is
now in common usage and marks an important
distinction in our responses to climate
change Responding to weather related risks and
climate risks may be a more useful language
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some simple adaptation messages

• adaptation directly benefits your own
  organisation
• effective adaptation responses can create more
  time for mitigation actions to slow down climate
  change
• adaptation is not just an environmental issue
  climate risks affect most aspects of business
• adaptation has not yet found a home in many
  organisations, and no-one is tasked with this
  area of responsibility

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2. climate change scenarios for UK over the
21st Century
Based upon Hadley Centre models and published as
UKCIP02 Scientific Report Await new set of
scenarios in UKCIP Next
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UKCIP02 climate change scenarios UKCIP
Scientific Report Data

• The main parameters used in reporting the data
• all referred to baseline data for 1961-1990
• regional variation 50 km square grid over UK
• three time periods 2020s, 2050s, 2080s
• four emissions scenarios L, ML, MH, H
• climate variables (see next slide) sea level
• means, maxima, minima
• 4 seasons Annual
• Probability Curves
• Expert judgements of levels of confidence

complex data which needs careful application
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Changes in average temperature
Low emissions
High emissions
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Daily maximum temperature probability of
exceedance
Central England summer temperature Baseline
(1961-90) 31oC has 1 chance I day per
summer 2080s, medium-high emissions 31oC has
11 chance 11 days per summer 39oC has 1
chance
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Changes in average precipitation
Winter
Summer
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High water level return period Immingham, Lincs
Baseline (1961-90)1.5m ca. 1 in 120 year
eventMedium-high Emissions, 2080s1.5m is ca. 1
in 7 year event
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Baseline (1961-90) - blue Medium-High Emissions,
2080s - red
Frequency of UK depressions
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How often will extremes occur? Medium high
emissions scenario percentage of years with..
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Summary of expected climate changes

• Long-term / seasonal averages
• Warmer, drier summers (spring, autumn too)
• Milder, wetter winters
• Rising sea levels
• Extremes
• More very hot days
• More intense downpours of rain
• Shorter return periods for high water levels at
  coast
• Uncertain changes in storms possible increase
  in winter

This level of information is often enough for
many stakeholders
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Land areas projected to warm more than
oceansGreatest warming at high latitudes
global annual mean temperature change, 2080s
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Some areas projected to become wetter, others
drier - Overall increase projected
Annual mean precipitation change, 2080s
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3. impacts of climate change on different
business areas
using BACLIAT Business Areas CLimate Impacts
Assessment Tool
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BACLIATBusiness Areas CLimate Impacts Assessment
Toola generic typology for considering climate
impacts on business areas

• markets
• logistics
• process
• finance
• people
• premises
• management responses

climate change provides both challenge and
opportunity
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Markets changing demand for goods and services

• tourism Med. is too hot so visit UK instead
• food drink summer preferences
• al fresco pavement cafes 24/7
• building design passive cooling, sustainable
  construction
• environmental technology
• monitoring, and technical fixes
• cars etc cooling as standard
• health new diseases, new technologies
• leisure demand for parks, gardens, heritage
• other global impacts on markets???

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Logistics vulnerability of supply chain,
utilities transport infrastructure

• disruption of utilities
• power
• water
• drainage
• disruption of transport
• road,
• rail,
• sea
• air
• vulnerability of raw
• materials production

arising from flooding coastal, riverine,
urban drought, wind and storm damage, subsidence
and heave, landslip, excess temperatures.
just in time systems increase vulnerability for
both manufacturing and retail
extreme events will set most new performance
standards
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Processimpacts on production processes and
service delivery

• agriculture crops
• nature conservation habitats
• heritage buildings and gardens
• food and drink temp. control
• waste health hazards
• construction extreme events
• office summer environment
• leisure impacts on beaches, amenities

Extreme Events will set most new performance
standards
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Finance implications for investment, insurance,
and stakeholder reputation

• ABI policies
• increased premiums variable premiums
  vulnerable locations uncertainty
• investment issues
• tests for future proofing of development
  projects?
• global impacts on international investment
• liabilities in extg. developments
• new liabilities may occur remedial
• action unlikely to be cost effective
• actions in future developments
• improved specification is normally cost effective

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People implications for workforce, customers
and changing lifestyles
new residential locations preferred trend to
north retreat from urban locations changed
travel to work patterns more pedestrian/cycle
journeys poor working environment external
construction, agriculture internal offices in
summer more complaint generally
siestas?? reputation as employer attract and
retain high quality staff
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Premises impacts on building design,
construction, maintenance facilities management

• all projects
• use future not historic climate data
• building fabric
• vulnerable to wind, rain and sun
• building structure
• vulnerable to storm and subsidence
• internal environment
• less winter heating,
• more summer cooling but avoid a/c
• existing buildings
• retrofit represents a major challenges,
• esp. low energy cooling in housing
• sustainable construction
• link CC adaptation and mitigation agendas

many built environment strategies are very
dependent on location
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Management Implications

• include climate risk in appropriate policies
• marketing strategies insurance investment
  premises etc
• identify roles and responsibilities
• appoint climate change adaptation champion
• adaptation is not just an environmental issue,
  so allocate roles and responsibilities
  accordingly, pursue impacts on all business areas
• treat CC as a change management task
• consider such as EMS / ISO14001
• undertake risk analysis
• senior management support
• mainstreaming or separate strategies?

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4. UKCIP Resources and Support, and future work
with business
all UKCIP resources are free
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UKCIP resources and support
Regional Partnerships Sectoral Partnerships Busine
ss Capacity Building LA Capacity
Building Climate change scenarios Socio-economic
Scenarios Adaptation Wizard Risk Management
Tool Costing Tool Adaptation Case
Studies Business Typology All on website
www.ukcip.org.uk
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Contents Headline messages Climate
scenarios Weather and climate impacts Impacts
assessment tool Impacts for some sectors Building
adaptive capacity Review of pilot project UKCIP
further programme with business

• George
• The chameleon provides an excellent set of
  metaphors for adaptation to a changing
  environment. As the surrounding environment
  changes, the chameleon changes its skin colour in
  three different, but related, ways.
• automatic response
• conscious controlled response
• chain reaction to other parts of body
• As the climate changes organisations will respond
  in similar ways.

Gerry Metcalf, Knowledge Transfer
Manager, UKCIP
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UKCIP future work with business

• sectoral approach
• work with individual businesses
• regional approach
• research led approach
• any others???

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sectoral approach

• with existing partners in trade and professional
  bodies
• with new partners in trade and professional
  bodies
• what are the priority sectors?
• improvements on CCFB pilot project?
• any other potential partners?

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with individual businesses

• partnership with BITC Business in the Community
  (FTSE companies)
• partnership with consultancies working with
  individual businesses
• partnerships with individual businesses
• others???

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regional approach

• RDAs in English Regions
• regional climate impacts partnerships
• sectoral groupings in regions
• Sub-regional approach, eg through Business Link
  or similar agencies
• any others potential partners???

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research led approach

• Knowledge Transfer Partnerships
• Others??

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Headlines for business

• Climate is changing in UK and globally
• Businesses are particularly vulnerable if
  currently affected by weather or making long-term
  investment in infrastructure
• Think in terms of weather related risks or
  climate risks
• Businesses with global markets and/or suppliers
  will be affected by climate change in other
  countries
• Climate change presents opportunities as well as
  threats but will probably affect bottom line of
  most businesses
• Climate impacts affect a range of business areas,
  not just the obvious ones, and certainly not just
  the environmental ones
• Adaptation and mitigation responses are
  complementary
• Start by giving someone responsibility for
  addressing climate risk and give them the
  necessary support (eg to undertake initial
  impacts assessment)
• Make use of UKCIP team and resources

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A changing climate for business Horizon South
West Exeter, July 2005
Gerry Metcalf Knowledge Transfer Manager UK
Climate Impacts Programme
www.ukcip.org.uk