Environmental concerns gained traction among risks identified by businesses surveyed in the World Economic Forum’s (WEFs) Executive Opinion Survey, which informs the 2021 Global Risks Report, published by the WEF with support from Marsh & McLennan. Four of five environmental risks featured in the top 20 global rankings for the first time. This trend is particularly pronounced in regions that recently faced significant disaster damages, notably Australia (wildfire) and Indonesia (flood). Extreme weather events and human-made environmental catastrophes joined natural catastrophes among the leading concerns for executives in the East Asia and Pacific region.
Today, it is crucial for companies and the (re)insurance market to incorporate climate change into business considerations as investors, ratings agencies and financial regulators apply pressure on firms.
Climate change impacts are likely to play out disproportionately across countries, exacerbated by long-existing inequalities. There is only a short window to redress these disparities. A shift towards greener production and consumption cannot be delayed until economies are revived. Governments – individually and in coordination – need to catalyze a transformation that amalgamates investment in green and inclusive economic recovery, with short-term measures to bridge gaps in health, education, employment prospects and social safety nets. A fractured future can be avoided by bridging these gaps and enabling opportunities for everyone.
Read about how climate change is continuing to be a looming risk, beginning on page 3 of the 2021 Global Risks Report.