Overview
(Week 3 )
In this unit, you’ll investigate the pathways linking climate change and business outcomes. For corporations, the financial impacts of climate change—both positive and negative—typically form the foundation of the business case for adaptation. As a result, a thorough understanding of the climate-related risks and opportunities arising for the organization is an important step in the business case planning process.
Business adaptation planners typically differentiate physical risks and transition risks. Physical risks are associated with damage arising from climate change (e.g., extreme weather events like flooding or severe storms, sea level rise, wildfires, heat waves, etc.) Other risks can be described as transition risks. These risks arise from society’s response to climate change.
On the opportunity side, adaptation methods can often produce benefits beyond risk reduction. Adaptation designed to decrease the energy or resource intensity of products and services provide the opportunity to reduce production costs. Improving the environmental performance of products and services can open up new markets among climate conscious clients and customers. Research and development aimed at process or product design can result in new intellectual property and valuable patents or can position an organization as an industry leader.
For governmental and non-profit organizations (and for some progressive private organizations), salient risks and opportunities may extend beyond financial impacts to incorporate social and environmental impacts. Issues such as health and well-being, equality and poverty reduction, security, employment, biodiversity, etc., may be the focus of risk and benefit assessments, and mission-effectiveness may replace financial optimization as the primary objective.
In this unit, you’ll choose an organization as an example and analyze its climate-related risk and opportunity exposure. You’ll explore several models for risk and opportunity discovery, including basic risk screening, geographic analysis of supply chains, and life cycle assessment. You’ll use some basic screening processes to enumerate your case study client’s risk and opportunity exposure and to select a priority for action.
Based on your assessment, you’ll research adaptation options that could be implemented to reduce the priority risk or capitalize on opportunity. The adaptation measures you identify will contribute to an online wiki that catalogues and publicly shares adaptation strategies for specific risks and opportunities (Assignment 2).
Activities and Assessment
- Online session
- Readings and independent exploration
- Risk and opportunity assessment (case study client)
- Background work for Reflective Blog #2 – Adaptation Strategies (Assignment 1)
- Conduct Risk and Opportunity Assessment (linked to Assignment 3: Business Case)