Corporate bosses have 'no control' over climate-related financial risks

Corporate chiefs believe they are neither prepared for, nor have any control over the adverse financial impacts on their companies of a changing climate. This is among the conclusions of a global survey conducted for FM Global of CEOs and CFOs at companies with £800m or more in revenue.

Some 77% of CEOs and CFOs said their companies are not fully prepared for the adverse financial impact of a changing climate; and 82% believe their companies have little control over such an impact; 76% said their organisations are exposed to climate risk, with floods, droughts and wildfires the greatest three exposures.

Katherine Klosowski, vice-president of FM Global's natural hazards and structures division, said the findings are particularly concerning as British businesses are potentially looking at flood-related losses in the coming years.

"Concerningly, the recent hot and dry weather that we’ve seen across Europe may exacerbate any flooding that does occur in the region. This could generate a monumental challenge for many businesses looking to deal with natural hazards like flooding alongside all the issues COVID-19 has already caused.

“Unfortunately, these are difficult times for many companies, as they struggle with volatile financial markets and the threat of an economic recession, coupled with the fact that COVID-19 may create further challenges when preparing for natural hazards."

These conclusions were drawn from a study conducted online in February 2020 among 150 CEOs and 151 CFOs across North America, Europe and Asia-Pacific (equally). Respondents lead companies over US$1 billion or more in revenue across a wide variety of industries. One-third of respondents lead companies of £4bn or more.

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