Business perspectives on Climate Adaptation and Resilience...Business perspectives on Climate...
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Transcript of Business perspectives on Climate Adaptation and Resilience...Business perspectives on Climate...
Business perspectives on Climate Adaptation and Resilience
Liaison Delegate meeting, Montreux1 April 2019
Session outline
14:30 – 14:35 Welcome and Introduction
14:35 – 15:15 Resilience Game
15:15 – 15:30 Climate Adaptation and Resilience – Policy
15:30 – 15:40 Presentation on TCFD / COSO
15:40 – 15:55 Discussion
15:55 – 16:00 Next steps
Understanding and creating
synergies between TCFD
and Climate Policy
Join the discussion on what business
needs to become more future proof
Welcome and IntroductionMaria Mendiluce, WBCSD
Science is bold and clear
Credit: Hannah Simmons, Climate Smart Group
Reality is going beyond our imagination
Credit: Hannah Simmons, Climate Smart Group
WBCSD Building a resilient power sector
Building Resilience in Global Supply Chains
COSO ERM ESG Guidance / Task Force on Climate-
related Financial Disclosure
Climate Smart Agriculture / CSA 100
Water-Smart Agriculture / Water stewardship
Sustainable Cities / Built Environment
Business Leadership on Climate Resilience
WBCSD work on resilience to climate change
Resilience GameRodney Irwin, WBCSD
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Resilience GameIntroduction
Redefining Value Montreux Sessions
Monday11:00 - 13:00 Investing Responsibly. Retiring Responsibly11:00 - 16:00 Social & Human Capital Workshop
Wednesday 09:00 - 10:30 Briefing Session Redefining Value11:00 - 13:00 Performance & Risk Management14:30 - 16:00 Disclosure Dilemmas & Decisions
Thursday09:00 - 10:30 Building Resilience through Enterprise Risk Management11:00 - 13:00 Turning Sustainability into a Competitive Advantage
Climate Adaptation & Resilience - Policy Veronika Neumeier, WBCSD
The IPCC Special Report on Global Warming of 1.5°Cemphasizes the urgency to scale up investmentacross and within sectors, especially in energy,land use and ecosystems (including oceans), humansettlements, infrastructure and industry.
Climate adaptation and resilience building areunderstood as the foundation and cornerstone ofsustainable development. The focus shall not be onthe cost, but on the economic and social benefitsof adaptation and resilience.
Climate change - A major global risk
WEF Global Risks Report 2019
“Climate-related risks to health, livelihoods, food security, water supply, human security, and economic growth are projected to increase with global warming of 1.5°C and increase further with 2°C.”
Climate Leadership for Resilience
“Adaptation must move into the mainstream of policy-making, business strategies and development planning.Through these efforts, the world can advance dynamicsolutions that will reduce risk and bring economicopportunities for more people. We are all in this together.We must mobilize leadership and unlock investments inadaptation that can improve people’s lives today and forgenerations to come.”
Ban Ki Moon, 8th Secretary-General of the United Nationsand Chairman of the Board, Global Center on Adaptation
WBCSD Building a resilient power sector
Building Resilience in Global Supply Chains
COSO ERM ESG Guidance / Task Force on Climate-
related Financial Disclosure
Climate Smart Agriculture / CSA 100
Water-Smart Agriculture / Water stewardship
Sustainable Cities / Built Environment
Business Leadership on Climate Resilience
WBCSD work on resilience to climate change
In 2019 and beyond, WBCSD aims to deepen its work onClimate Adaptation and Resilience by using cross-sectoral andcross-organizational approach integrating WBCSD projectsand members, and connecting inputs from Climate andEnergy, Climate Smart Agriculture, Built Environment,Water, Redefining Value and other relevant aspects.
WBCSD Report 2019 on Business Leadership on Climate Resilience
Objective 2: Business narrative for Climate Adaptation and Resilience
Objective 1: Engagement of cross-sectoral programs
Climate Adaptation & Resilience – Building business narrativeEric Dugelay, Deloitte
TCFD
Members
Institutionalbodies
Public authorities
Policy makers
Redefining Value team
Climate Action &
Policy team
Climate Smart Agriculture
team
Water team
BuiltEnvironment
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The business case to understand obstacles and levers, risks and opportunities
Elevating business action on resilience
WBCSD narrative for Climate Resilience
Building strong synergies Develop the business narrative on resilience
Project strategy
WBCSD WorkshopGeneva, Switzerland
State of Play review
Project and stakeholder consultation
WBCSD Member consultation
Analysis &Report Writing
Validation Workshop
Report Launch
23Sept
1-4Apr
WBCSD LD MeetingMontreux, Switzerland
WBCSD Council MeetingLisbon Portugal
Feedback loops
14-17Oct
May/June
February – March 2019 March – May 2019 September 2019
Project Outline Timeline
WBCSD Climate Policy WorkshopGeneva, Switzerland
State of Play review
Project and stakeholder consultation
WBCSD Member consultation
Analysis &Report Writing
Validation Workshop
Report Launch
Aug18-22Mar
Africa Climate WeekAccra, Ghana
UNSG Climate SummitNew York, USA
1-4Apr
WBCSD LD MeetingMontreux, Switzerland
Asia-Pacific Climate Weektbc
Latin America & Caribbean Climate WeekSalvador de Bahia, Brazil
2-13Dec
COP 25Santiago, Chile
Feedback loops
2-6Sept
May /June
Project outline Policy outlook for 2019 and beyond
23Sept
WBCSD Council MeetingLisbon Portugal
14-17Oct
Understanding Climate Resilience and related risks and opportunities
COSO & TCFD ResilienceRodney Irwin, WBCSDLois Guthrie, WBCSD
COSO’s ERM FrameworkEnterprise risk management is the culture, capabilities and practices, integrated with strategy-setting and its performance, that organizations rely on to manage risk in creating, preserving and realizing value.
Applying enterprise risk management to environmental, social and governance-related risks
Enterprise Risk Management & resilience Assess, prioritize & respond to risk
• Risk assessments that consider velocity, resilience, adaptability
• Prioritization that considers resilience –appropriate risk severity measures
• Risk responses to enhance resilience –pursue, share, reduce
Connecting COSO & TCFD - ERM
OpportunitiesTransition Risks
Physical Risks
ChronicAcute
Policy and Legal
Technology
Market
Reputation
Resource Efficiency
Energy Source
Products/Services
Markets
Resilience
Financial Impact
Strategic Planning Risk Management
Risks Opportunities
Revenues
Expenditures Capital & Financing
Assets & LiabilitiesBalance Sheet
Cash Flow Statement
Income Statement
Governance
Strategy
RiskManagement
Metrics and
Targets
TCFD recommended disclosure – Strategy c) Describe the resilience of the organization’s strategy, taking into consideration different climate-related scenarios, including a 2°C or lower scenario
Measures of resilience − Committed & uncommitted capital expenditure− Capital discipline− Production forecasts & reserve life − Payback periods− Portfolio optimization/diversity – options− Breakeven, IRR and cost of supply − Sensitivity to carbon and oil prices
Assumptions, parameters related to scenario analysis and sensitivities− CC(U)S, changing consumption, electrification uptake, natural climate solutions etc.− Impact on cash flow, net present value etc.
TCFD & Resilience - Oil & Gas Preparer Forum examples
Eni measures of resilience – breakeven, IRR, flexibility - uncommitted spend and sensitivities
Shell measures of resilience – earnings through oil price cycles and liquid natural gas unit cost of supply
Uncertainties & complexity
Indicators and measures of climate resilienceHigh-level tests for assessing resilience in a time of transition...
Business model and strategy
• fit for the future• financed for the
future• supported by
structural and management capacity
Flexibility, adaptive capacity
and discipline• financial
discipline• cash and capital
flexibility• portfolio flexibility• options• expertise
Governance
• commitment to execute the plan is embedded in organizational capital in the long term
Climate integration
• climate considerations are integrated into risk management, planning and financial analysis
Electric Utilities
Chemicals
Current TCFD Preparer Forums Members
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Provide an overview of key risk management and sustainability concepts, play the game, give practical examples and more.
For eligible companies, we’ll travel to you to:1
Provide us with your high-level ERM processes and policies in advance. Join a call prior to the workshop for planning purposes. Ensure participants have read the guidance.
What you’ll need to do:
Lead sustainability practitioners or the CSO, your risk management team or the CRO, representatives from compliance, internal control operations etc.
Who should come?
Ongoing technical support from WBCSD’s risk team, an implementation plan, a complete high-level diagnostic, a summary slide deck, a stronger relationship between risk and sustainability functions.
What you’ll gain
Representing USD $1.5 trillion in market cap and 200 of the world’s top companies, WBCSD
grasps the scope, challenges and – most importantly – the pace of modern business
We’ll help you implement through an in person training
Contact leach@wbcsd, taylor@wbcsd and irwin@wbcsd to organize a training
DiscussionVictor Caritte, DeloitteVeronika Neumeier, WBCSD
What is the key priority for your business?
Discussion
Next stepsKarl Vella, WBCSD
WBCSD WorkshopGeneva, Switzerland
State of Play review
Project and stakeholder consultation
WBCSD Member consultation
Analysis &Report Writing
Validation Workshop
Report Launch
23Sept
1-4Apr
WBCSD LD MeetingMontreux, Switzerland
WBCSD Council MeetingLisbon Portugal
Feedback loops
14-17Oct
May/June
February – March 2019 March – May 2019 September 2019
Project Outline Timeline
Interested in contributing to this work?Please contact us!
[email protected] & [email protected]
Eric DugelayPartner
Sustainability Services, Deloitte
Member of the TCFD
Victor CaritteSenior Consultant
Sustainability Services, Deloitte
Eloïse CouffonConsultant
Sustainability Services, Deloitte
Veronika NeumeierAssociate
Climate Policy, WBCSD
Project Team
Karl VellaManager
Climate Policy, WBCSD
