Climate risk looms over all large global companies
For 1 in 3, climate risk will cause at least 20% of the value of the exposed asset to be lost
(Sustainabilityenvironemnt.com) – By 2050, more than 9 out of 10 large global companies (92%) will have at least one of their assets highly exposed to climate risk, with the possibility of physical damage. This already very high percentage will still rise to 98% by the last decade of this century, in a climate scenario where climate change mitigation measures do not improve compared to today.
This was calculated by S&P Global, one of the leading financial services companies in the world, by analyzing the 20,000 most important companies globally. The level of preparedness of the private sector in climate change risk assessment in the coming decades is a crucial aspect of the response to the climate crisis. Without the necessary measures to prevent and mitigate climate risk, economic and social damage could increase.
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Bringing companies to their knees in the first place. S&P Global estimates that, by the middle of the century, more than a third (34%) of the world’s largest companies will have at least one asset so exposed to climate risk that at least 20% of its value is at risk. This figure rises to 48% by 2090 in a climate scenario in line with today’s. These percentages go up dramatically when it comes to energy companies or companies that deal with mineral resources and other key raw materials for the global economy. In this case, the number of companies at risk is even 70%.
So far, the situation we find before our eyes today. Does it help to act against climate change? Yes, and not just a little. The number of companies exposed to high levels of climate risk can be reduced by 20% (bringing it down to 39%) by 2090 if the planet takes an emissive scenario capable of limiting the increase in global temperatures below 2 degrees.