New Report Gives Companies Tool to Adapt to Climate Change
For companies that may be at risk because of climate change, the report offers practical step-by-step guidance to take action to manage challenges and opportunities.
This week Calvert Investments and other leading companies from the Partnership for Resilience and Environmental Preparedness (PREP) released a first-of-its kind guide for businesses to assess and prepare for the risks and opportunities posed by climate change, entitled Value Chain Climate Resilience: A guide to managing climate impacts in companies and communities. The guide was prepared jointly by businesses in an effort to bring increasing attention and knowledge within their industries about how climate change could affect operations and what can be done now to prepare and includes examples of steps some companies are already taking to address the risks caused by increasingly severe and frequent weather events and other climate threats.
Companies in PREP include Calvert Investments, Earth Networks, Entergy, Green Mountain Coffee Roasters, Inc., Levi Strauss and Co., Starbucks and Swiss Re.
Corporate leaders and sustainable investors will find this report a useful tool and complement to the disclosure guidance report issued in May by Calvert, Ceres, and Oxfam America (see Physical Risks from Climate Change: A guide for companies and investors on disclosure and management of climate impacts). Value Chain Climate Resilience aims to help company executives and senior managers gain a better understanding of climate-related risks throughout their value chains, identify where emerging market opportunities exist, take into account community needs, and develop plans that are integrated throughout the enterprise with the support of communities and civil society. The guide will also help the financial services and insurance sectors understand how to engage with the companies they invest in or insure to manage risk, maximize returns, and minimize future losses.
The Business ADAPT tool included in the guide offers five simple steps to help companies take action inspired by existing good practices. The tool provides additional questions for managers and executives in three business sectors that are considered highly vulnerable to climate change: Food Beverage and Agriculture, Water and Energy Utilities, and General Manufacturing.
Calvert intends to use the report to inform its investment research and advocacy efforts. We plan on sending the report to a number of key corporations held in Calvert fund portfolios in an effort to encourage strategic management of climate change risks and opportunities.
Download the report here: Value Chain Climate Resilience: A guide to managing climate impacts in companies and communities.
Adaptation presents real opportunities for forward-thinking companies
The United Nations defines climate change adaptation as "initiatives and measures to reduce the vulnerability of natural and human systems against actual or expected climate change effects." Calvert believes that climate change mitigation (efforts focused on greenhouse gas emissions reductions) and climate adaptation must move forward together; and that adaptation is a way for companies and investors to not only reduce risks, but grasp the opportunities climate change presents. Competitive companies must not only commit to mitigating climate change by reducing their carbon footprint, but also must also strategically plan for and adapt to climate change impacts.
Climate adaptation is gaining traction as a pragmatic way to address the impacts of climate change by companies, governments, and, we hope, investors, an opportunity for progress at a time when policies intended to set a price on carbon have lost political viability in the U.S. Yet, the business community and policy-makers alike are finding common ground around climate adaptation, if not around mitigation to the extent that we have advocated.
Climate adaptation also touches on other key sustainability issues, including disproportionate impacts on poor communities and countries in ways that raise human rights as well as environmental and economic issues.
Calvert's role in driving change
Calvert is a founding member of the Partnership for Resilience and Environmental Preparedness (PREP), a coalition of partners including Starbucks, Swiss Re, Entergy, and Levi Strauss & Co., and Oxfam America, formed to address climate change impacts on businesses and communities. Calvert is also actively encouraging policy makers to make sound policy decisions that encourage resilience-building and preparation for climate change both here and abroad.
We drive investments towards adaptation and resilience-building throughout the investment portfolio of Calvert's sustainable and responsible investment (SRI) funds. Through Calvert Signature Strategies®, we encourage companies to develop forward-thinking climate strategies that address risks and opportunities from climate change. Earlier this year, Calvert filed a proposal with the J.M. Smucker Company, owners of Folgers and other coffee brands, asking it to manage risk to its coffee business from the physical impacts of climate change. Calvert has also had productive engagement on climate risk disclosure with Dr. Pepper/Snapple, Yum!Brands, and Hanesbrands after we filed shareholder resolutions with those companies. Our shareholder proposal on climate risk and water at apparel maker Fossil earned 31% shareholder support in May of 2012. The Calvert Solution Strategies® offer a unique opportunity to invest in adaptation through companies focused on alternative energy and water engineering and infrastructure, water conservation and re-use, and water treatment technologies. Finally, investments through our Special Equities program help spur innovations such as sustainable yield enhancing biopesticides and soil moisture monitoring for farmers.
Calvert Investment Management, Inc., 4550 Montgomery Avenue, Bethesda, MD 20814