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The factors that drive business decisions — from market and risk intelligence data, to local building codes, to employee safeguard requirements — were developed in the context of climate stability, based on predictable bands of variation in weather patterns and climate-related events. Today, scenario-planning based on factors derived from the assumption of a stable climate will lead to under-protection of assets and miscalculations of operating costs, market size, and even customer preferences. Potential impacts of a changing climate in a given location is knowable information if one knows what to look for, where to look, and understands the basics of climate change that underpin this data. Senior managers need to lead the effort to become climate literate and to then enable all of their employees, especially aspiring and rising managers, to do the same. Armed with that capability, managers — and all employees — can make better decisions for their companies and the societies that depend on their goods and services.
A complex set of risks and opportunities related to climate change are coming at businesses across the globe with increasing frequency and speed. Managers are generally aware of the potential impacts of climate-driven events like wildfires, extreme heat, drought, and flooding on their operations, including their impact on supply chains; availability of materials; trade and transportation routes; energy availability and costs; well-being, availability, and productivity of their employees; and even market demand for their goods and services.
Source : Harvard Business