Global Weather Patterns - An Economic Assessment, July 2014
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Transcript of Global Weather Patterns - An Economic Assessment, July 2014
Impact of Climate Change on Global Economy
July 2014
Climate change has affected the global supply chains of various industries, including agriculture, manufacturing, oil & gas, and professional services, resul:ng in economic losses worth billions of dollars. This has called for adapta:on, and mi:ga:on policies and ini:a:ves to sustain business opera:ons and supply chains.
Objective
In this report, The Smart Cube examines the impact of changing clima:c condi:ons and the resultant erra:c weather paAerns on businesses across various industries.
Contents
§ Execu&ve Summary
§ Climate Change Overview
§ Impact on Global Economy
§ Impact on Industries
§ Impact on Companies
§ Poten&al Solu&ons
§ Key Ques&ons to Consider
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EXECUTIVE SUMMARY
Several critical industries have been affected by extreme weather conditions during the last few years–insurance being the most impacted and professional services, the least
Low
Low
High
Revenue Loss (2010–2013) High
In 2013 only , natural disasters cost insurers $45 billion—24% of the global economic loss from natural
calami:es
Key Regions Impacted
North America
South America
Europe
Asia Pacific
Middle East & Africa
Notes: 1) The list of industries is not exhaus&ve 2) This quadrant has been developed based on TSC’s understanding of the industries and climate change assessment
Impact of Climate Change on Industries1,2
Insurance
Agriculture Coffee
ConstrucJon Oil and Gas
Manufacturing
Travel & Tourism
Professional Services
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Cause § Global warming caused by the following:
― CO2 emissions from fossil fuel ― Methane emissions from animals,
agriculture ac&vi&es, and from Arc&c seabed
― Excessive deforesta&on ― Increased use of chemical fer&lizers on
croplands
Cause – Human Ac&vi&es
Climate Change
Effect – Natural Disasters
5
Evidence, Causes, and Effects
Source: NASA (www.climate.nasa.gov); Natural Resources Defence Council (NRDC); American Associa&on for the Advancement of Science (AAAS); www.planetsave.com
CLIMATE CHANGE
In the near future, frequency of extreme and erratic weather conditions will likely increase due to global warming
Effect § Increase in number and intensity of natural
calami&es, such as tropical storms, tornadoes, floods, droughts, and wildfires
§ Extreme weather condi&ons § Massive crop failures § Ex&nc&on of species
Evidence
Rise in Sea Level
Rise in Global Temperature
Warming Oceans
Shrinking Ice Sheets
Declining Arc&c Sea Ice
Glacial Retreat
Frequent Extreme Weather Paaerns
Ocean Acidifica&on
“Climate change is a fact. And when our children's children look us in the eye and ask if we did all we could to leave them a safer, more stable world, with new sources of energy, I want us to be able to say yes, we did.” – Barack Obama, President, US (January 2014)
“It is clear from extensive scien:fic evidence that the dominant cause behind the rapid change in climate over the past half century is human-‐induced increase in the amount of atmospheric GHGs.” – American Meteorological Society (August 2012)
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85
180
255
40 80
220
58
252
435
200 192
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Global Economic Losses from Natural Disasters ($ billion, 2003–2013)
Global Economic Losses from Natural Disasters – by Region (2013)
Global Economic Losses in Last Decade
100% = $192 billion
10-‐year average = $200 billion
The Japan earthquake and tsunami inflicted damages worth ~$210 billion, which made 2011 the costliest natural disaster year on record
In 2013, Asia and North America
were the worst hit regions,
accounOng for 70% of the
economic losses
Global Economic Losses from Natural Disasters – by Type of Disaster (2013)
100% = $192 billion
Global natural disaster losses in 2013 were 4% below the 10-‐year average, while the insured losses ($45 billion) were 22% below the 10-‐year average
of $58 billion
At ~$22 billion, the floods in
Central Europe during May–June 2013 were the most damaging natural calamity
in the year
Source: ‘Annual Global Climate and Catastrophe Report Impact Forecas&ng 2013’, Aon Benfield (2014)
Asia 50%
USA 15%
North America (except USA) 7%
Europe 19%
South America
6% Oceania
3% Africa 1%
2013 was riddled with 296 natural disasters1, causing economic losses to the tune of $192 billion
Global Economic Losses in 2013
Note: 1) An event must meet at least one of the following criteria to be classified as a natural disaster: Economic loss of $50 million, insured loss of $25 million, 10 fatali&es, 50 injured, or 2,000 homes damaged
IMPACT ON GLOBAL ECONOMY
Economic losses is likely to increase significantly due to rising frequency of extreme/erratic climatic patterns
Flood 35.4%
Tropical Cyclone 19.0%
Severe Weather 15.1%
Drought 14.6%
Earthquake 10.2%
Others 5.7%
Source: ‘Annual Global Climate and Catastrophe Report Impact Forecas&ng 2013’, Aon Benfield (2014)
Source: ‘Annual Global Climate and Catastrophe Report Impact Forecas&ng 2013’, Aon Benfield (2014) Source: ‘Annual Global Climate and Catastrophe Report Impact Forecas&ng 2013’, Aon Benfield (2014)
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Readiness vs. Vulnerability of Various Countries1 to ClimaOc Changes
Source: Notre Dame Global Adapta&on Index (www.gain.org); Environmental Performance Index (www.epi.yale.edu)
Countries with high vulnerability need to strengthen policies and ensure effective implementation to mitigate climate change impact
Low
Low
High
Readiness
Vulnerab
ility
High
Note: 1) The list of countries is not exhaus&ve
Countries in this quadrant typically belong to Western Asia and Eastern Europe
Countries in this quadrant are typically developing countries of South Asia, Southeast Asia, and Africa
The governments have taken many iniOaOves to tackle climate change; however, mulOple gaps—such as informaOon and technological gap, policy and governance gap, and insOtuOonal and coordinaOon gap—at various levels act
as barriers
Countries in this quadrant typically comprise island countries of the Caribbean
Countries are gradually framing and updaOng miOgaOon and adaptaOon policies; moreover, the private sector has been acOvely parOcipaOng in an
effort to improve adaptability to changing climate
Despite efforts by governments to strengthen policy frameworks on climate change adaptaOon and miOgaOon, the readiness is low due to poor
implementaOon of policies
Countries in this quadrant are typically in North America and Europe, including some developed countries from Asia, Africa,
and South America
The governments have detailed policies and frameworks in place to adapt to the changing climate; further, the private sector, along with the government,
has taken numerous iniOaOves to miOgate the impact of climate change
IMPACT ON GLOBAL ECONOMY
Sri Lanka
Vietnam India
Indonesia South Africa
Fiji Jamaica
Dominican Republic
Iran
Egypt China
Russia Brazil
US UK
France
Source: TSC Analysis
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Policies and IniOaOves by Various Governments
Source: Notre Dame Global Adapta&on Index (www.gain.org); Government of Connec&cut; www.chinadialogue.net
Many governments have realized the increasing impact of climate change on their economies and have made efforts to counter this impact
Vulnerability Readiness Countries1 Policies & IniJaJves2
Low Low China, Iran, Egypt, Russia
§ In areas in China where there is a water shortage, the local government has taken ini&a&ves to explore groundwater sources to maintain supply; further, migra&on projects have been introduced in provinces that have become uninhabitable due to frequent droughts
§ To reduce high temperatures in urban Chinese ci&es, campaigns have been launched to increase green space and improve air quality
Low High
US, UK, France, Switzerland, Brazil, Italy, Australia
§ In order to abate air pollu&on, Northeastern and Mid-‐Atlan&c states have a joint CO2 cap and trade program—applicable to the electricity sector—that is enforced by individual states’ environmental protec&on agency
§ During 2010–2012, various provinces in Italy carried out mul&ple ini&a&ves, such as training ci&zens and enac&ng laws, to mi&gate human impact on climate change
High Low India, Sri Lanka,
Vietnam, Indonesia
§ In 2011, Sri Lanka came up with a Na&onal Climate Change Adapta&on Strategy that provided preven&ve and adapta&on measures against climate change at the na&onal level, including key sectors such as agriculture, health, and fisheries
§ India launched a Na&onal Ac&on Plan on Climate Change in 2008 that listed ac&onable objec&ves for climate adapta&on and GHG mi&ga&on
High High
South Africa, Dominican
Republic, Fiji, Jamaica
§ South Africa has developed separate adapta&on strategies for its water, agriculture, and health sectors, as these are the key sectors through which climate change impacts will be felt the most by the people, ecosystem, and economy
§ Further, the country has developed mi&ga&on strategies for energy, industry, and transport sectors
§ Similarly, the government of Fiji in its 2014 policy on climate change elaborated the poten&al impact of climate change on key sectors—such as agriculture, water, health, fisheries, communica&ons, and transport—and mi&ga&on opportuni&es
Note: 1) The list of countries is not exhaus&ve 2) An illustra&ve list of policies and ini&a&ves have only been provided
MITIGATIVE POLICIES AND INITIATIVES
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9 Source: TSC Analysis
Note: 1) The list of industries is not exhaus&ve 2) The term “Agriculture” has been used to refer to produc&on of staple crops
IMPACT ON INDUSTRIES
During 2010–2013, agriculture, oil & gas, and automobile have primarily faced the heat of extreme weather conditions
Key Industries1,2 Affected by Extreme Weather During 2010–2013
§ Agriculture (Corn and Soybean)
§ Coaon
§ Ethanol
§ Agriculture (Corn and Soybean)
§ Coffee
§ Agriculture (Wheat, Maize, and Barley)
§ Agriculture (Wheat)
§ Coaon
§ Agriculture
§ Coffee
§ Tea
§ Oil & Gas
§ Fisheries
§ Professional and Technical Services
§ Coffee
§ Sugar § Chemical
§ Computer (Hardware)
§ Automobile
§ Coal
§ Agriculture
§ Tourism
§ Travel and Tourism
§ Pharmaceu&cal
§ Oil & Gas
§ Manufacturing
§ Insurance § Oil & Gas § Agriculture (Rice and
Sugarcane)
§ Livestock & Fisheries § Agriculture
§ Insurance
§ Automobile
§ Construc&on
North America South America Europe Asia Pacific Middle East & Africa
Drought
Flood
Tropical Storm
(Hurricane, Cyclone, etc.)
Wildfire
Tornado
Extrem
e Weather Con
diJo
ns
Regions
§ Forestry
§ Insurance
§ Tourism
§ Insurance
§ Construc&on
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10 Source: The Guardian; USDA; NOAA; EIA; Bloomberg; Government of Illinois (www.illinois.gov); The Wall Street Journal; CNN; Renewable Fuels Associa&on; Human Events (www.humanevents.com)
CASE IN POINT: INDUSTRIES
The 2012, US droughts indirectly affected the local ethanol industry, reducing production and exports by 5% and 40%, respectively
Direct and Indirect Impact On Industries
§ In the summer of 2012, the US suffered one of its worst droughts in the last 50 years; the drought impacted agriculture and livestock across the country ― According to the United States
Department of Agriculture (USDA), the drought affected 40 states and 80% of the overall farmland
― Further, according to USDA figures, in July 2012, the country witnessed its smallest caale inventory since 1973
§ In the US, a sizeable share (40%) of the corn harvest goes into the produc&on of ethanol, a major biofuel addi&ve for gasoline due to the US government’s mandate of blending a certain amount of ethanol into gasoline, to reduce par&culate emissions from vehicles
§ High corn prices significantly reduced the profitability of ethanol producers in the US, forcing them to pare down or cease produc&on (~10 producers ceased opera&ons)
§ In 2012, the US exports of fuel ethanol reduced ~40% Y-‐o-‐Y, from 28.5 million barrels in 2011 to 17.6 million barrels in 2012
No industry is immune from the adverse affects of climate change; some industries are directly impacted such as agriculture and construcJon, while the others are indirectly
impacted
Example (Impact of US Drought in 2012)
§ The drought severely affected corn crops ― Corn produc&on in 2012 was 10.8
billion bushels, 13% below the 2011 produc&on level
― The drought caused corn prices to surge worldwide, as the US is a major corn exporter
The Extreme Weather Event Direct Impact on Corn Crops Indirect Impact on Ethanol Industry
“I cannot see any profitability in this (ethanol) industry un:l we get lower corn prices, and it is going to take a reasonably sized US crop.” – Chris Hurt, Agriculture Economist, Purdue University (February 2013)
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Case Example 1 – Western Digital: Speedy Recovery Aeer Thai Flood in 2011 (1/2)
Source: ‘Resilient Response and Recovery at Western Digital: Aver the Thai Flood’, UCLA Anderson School of Management (2013)
Note: 1) HDD denotes Hard Disk Drive
CASE IN POINT:COMPANIES
In 2011, Western Digital had to halt production in Thailand owing to flooding
Western Digital (WD) in Thailand § Headquartered in Irvine, California, Western Digital
Corpora&on is a global manufacturer of HDDs, networking equipment, and home entertainment products
§ It is the world’s largest manufacturer of HDDs; in 2013, it had a market share of ~45% in value terms
§ The company manufactures ~60% of its HDDs in two facili&es in Thailand, one at Bang Pa-‐in (BPI) Ayuthaya Industrial Estate and the other at Navanakorn Industrial Park
HDD1 Industry in Thailand § In 2010, Thailand was the second-‐largest
manufacturer of HDDs, accoun&ng for 40% of the global produc&on
§ HDD manufacturers form the core of the Thai computer hardware industry, which includes component manufacturers, assemblers, and other related industries
Impact on HDD Industry & Western Digital § HDD manufacturing had to be temporarily pared
down as the opera&ons of most HDD component suppliers were affected by the flood; as a result, there was a 29% (Q-‐o-‐Q) decline in the number of HDDs produced in Thailand in Q1 2012
§ As the supply fell, average HDD price increased from $51 to $66 in the same quarter
§ WD’s produc&on capacity was significantly affected during Q4 2011, as flood waters breached its facili&es, forcing the company to halt produc&on ― The company shipped 28.5 million HDDs in Q1 2012,
about half the number of drives shipped in Q1 2011
2011 Thailand Floods § Thailand is prone to seasonal floods that occur in
the north and spread down the Chao Phraya river—a major river in the country—through the central plains
§ In mid-‐2011, the country witnessed its worst flooding in five decades, triggered by Tropical Storm Nock-‐ten; the flood disrupted opera&ons of several industries in Thailand, especially HDD and automobile
§ The World Bank es&mated economic damages and losses worth $50 billion due to the floods; moreover, the floods severely disrupted the global supply chains of computer and automobile industries
CASE OVERVIEW
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12 Source: ‘Resilient Response and Recovery at Western Digital: Aver the Thai Flood’, UCLA Anderson School of Management (2013); ‘Western Digital: Flood Response & Recovery’, Thai-‐American Business Magazine (2012)
Company recovered quickly due to well-executed contingency plans and strong supplier relationships
Lessons Learnt
Before the Flood
§ Knowing Thailand to be flood-‐prone, WD had developed a Business Con&nuity Plan (BCP)—in addi&on to the plans developed by the Thai government and the Bang Pa-‐in Industrial Estate—to safeguard its employees and facili&es; however, the plan was not suitably designed for a flood of the magnitude experienced in 2011
§ WD's dedicated BCP team had performed the following tasks in order to mi&gate the impact of floods: ― Assessed the likelihood of the flood and its poten&al impact on its plants and suppliers
― Prepared plants to stop and manage floodwater ― Prepared mi&ga&on and con&ngency plans to shiv produc&on to Malaysia in case of a plant shutdown ― Developed communica&on plans with all employees, suppliers, and other units across the organiza&on
During and Aeer the Flood
§ Despite these preven&ve measures, WD was unable to stop floodwater from entering its facili&es; as a result, the company established a temporary office in Bangkok and took the following measures to minimize the impact of floods: ― Minimizing Supply Chain DisrupOon: To reduce the impact of plant shutdown on customers, WD decided to shiv produc&on from
Thailand to Malaysia; consequently, WD ramped up its Malaysian facili&es to full capacity with the help of suppliers ― Recovering Submerged Equipment: To reduce recovery &me, WD decided to retrieve and rebuild submerged equipment;
consequently, the company retrieved and repaired its cri&cal equipment with the help of suppliers that were not affected by the flood
§ Well-‐executed con&ngency plans and strong rela&onship with suppliers helped WD’s BPI facility to be reopened in just 46 days aver its closure, weeks ahead of internal and external expecta&ons
§ Aver the 2011 floods, WD ins&tuted addi&onal measures to protect its plants and industrial estates ― The company made certain opera&onal changes, such as opera&ng manufacturing plants at least 2.7 meters above the ground
level and keeping lightweight equipment on ground floors; in addi&on, WD plans to construct flood walls around its factories
§ The company has also realized the importance of having strong supplier rela&onships and has taken steps to strengthen rela&onship with exis&ng suppliers; aver the 2011 floods, the company helped its suppliers repair and renovate their factories to reinstate manufacturing opera&ons
CASE IN POINT:COMPANIES
Case Example 1 – Western Digital: Speedy Recovery Aeer Thai Flood in 2011 (2/2)
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Case Example 2 – Business ConOnuity at Starbucks (1/2)
Source: The Guardian; Kew Royal Botanical Gardens (www.kew.org)
Arabica beans—used by Starbucks—face extinction by the end of century due to changing climatic conditions
Risk of Climate Change on Starbucks § Starbucks Corpora&on—the largest coffee retailer—
sources nearly two-‐thirds of its coffee from small-‐scale producers in La&n America, Indonesia, and Africa
§ Declining produc&on of Arabica beans and the consequent price rise threaten to restrict the availability of Arabica beans, which will reduce the purchasing capacity and profit margins of Starbucks
Climate Change and Coffee Industry § La&n America—the largest coffee-‐producing region—
has witnessed changing climate paaerns over the last decade; this has intensified droughts and plagues in the region, crea&ng condi&ons less suitable for coffee produc&on
§ The ongoing drought in Brazil—the largest producer of Arabica coffee in the world—has caused uncertainty over produc&on yield, leading to a significant rise in coffee prices over the last few months ― Brazil's Na&onal Coffee Council es&mates the harvest
to be 10% lower than the previous year ― Price of Arabica beans has jumped 90% in 2014 to ~
$2.15/pound—the highest in last two years
§ The coffee leaf rust outbreak across Central America in 2013 reduced yield by 20–30% Y-‐o-‐Y in 2013–2014
§ Another coffee rust outbreak in Colombia during 2008–2011 damaged ~33% of the country’s coffee plants
§ According to a 2012 study by the Royal Botanical Gardens—an interna&onal botanical educa&on and research ins&tu&on in the UK—climate change could lead to the ex&nc&on of Arabica coffee before the end of this century
CASE IN POINT:COMPANIES
CASE OVERVIEW
“If we sit by and wait un:l the impacts of climate change are so severe that is affects our supply chain, then that puts us at a greater risk. From a business perspec:ve, we really need to address this now, and to look 5, 10, and 20 years down the road.” – Jim Hanna, Sustainability Director, Starbucks CorporaJon (October 2011)
“The rise in global temperature is of great concern for us in the coffee industry because it will—and has already started—pucng the supply of quality coffee at great risk.” – Dr. Tim Schilling, ExecuJve Director, World Coffee Research Program, Texas A&M University (March 2014)
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Case Example 2 – Business ConOnuity at Starbucks (2/2)
Source: Company Website; ‘Starbucks Global Responsibility Report: Goals and Progress 2013’, Starbucks (2013); The Guardian
Starbucks has taken several initiatives to ensure a robust supply of coffee in the short to long term
Business ConJnuity
§ The company has taken several ini&a&ves to ensure business con&nuity, including the development of sustainable supply chain, detailed sourcing strategy, and diversifica&on plan
§ Sustainable Supply Chain: To improve the sustainability of its supply chain, Starbucks ac&vely seeks to ethically source coffee, tea, and cocoa, and support farmer communi&es with financial aids; in addi&on, Starbucks directly collaborates with coffee farmers and suppliers to encourage responsible growing prac&ces and improve the quality and size of harvests
§ Sourcing Strategy: In order to avoid short-‐ to medium-‐term deficit and price fluctua&ons, the company buys coffee well in advance (at &mes two years in advance) but sets the price later ― In 2014, the strategy has helped Starbucks to par&ally insulate itself from the price rise of Arabica beans; by April 2014,
Starbucks had already contracted its requirement for the year, and also 40% of the requirement for next year
§ DiversificaJon Plan: In a move to diversify from its product offering (which is in-‐store coffee sales), the company acquired Evolu&on Fresh—a California-‐based fruit juice company—in November 2011; with the acquisi&on, Starbucks indicated its inten&on to diversify into the high-‐growth juice and health food markets
CASE IN POINT:COMPANIES
Steps Taken Through Coffee and Farmer Equity PracJce (C.A.F.E)
§ Increase economic, social, and environmental sustainability in the specialty coffee industry, including conserva&on of biodiversity
§ Encourage Starbucks suppliers to implement C.A.F.E. Prac&ces through economic incen&ves and preferen&al buying status
§ Purchase a majority of Starbucks coffee under C.A.F.E. Prac&ces guidelines by 2007
§ Nego&ate mutually beneficial long term contracts with suppliers to support Starbucks growth
§ Promote transparency and economic fairness within the coffee supply chain
“Addressing climate change is a big priority for Starbucks. We believe now is the :me to increase our investments in solu:ons and strategies that address this crisis. The steps we are taking not only address our environmental footprint, but also help ensure the supply of high-‐quality coffee that our customers expect from us into the future.” – Starbucks’ Policy to Tackle Climate Change
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15 Source: Business Insider; The Wall Street Journal; PricewaterhouseCoopers; American City Business Journals
Wal-Mart and Noble Energy’s business continuity plans helped them curb the impact of natural calamities on operations and, consequently, revenues
Company Challenge Impact and SoluJons Adopted
§ The main challenge that Noble Energy—one of the largest oil & gas operators in Colorado—faced was to shut down its oil & gas wells to prevent oil spills
§ Noble’s early disaster response and efficiency in managing emergency opera&ons helped lower the damage on its wells and storage tanks ― As part of its con&ngency plans, the company remotely
shut down its wells even before flood warnings were issued; further, some employees were rushed to certain well sites to physically shut them off
― As a result, the company was able to minimize equipment damage and oil spills, and mi&gate the monetary impact of the flood
§ Moreover, Noble’s employees were involved in community relief opera&ons
Disaster
Colorado Flooding (2013)
Wal-‐Mart § During the storm, the company’s stores and distribu&on centers were affected by power outages
§ Its main challenge was to transport and set up generators to get its stores up and running
§ Wal-‐Mart’s well-‐established rela&onships with mul&ple state governments and power companies helped it reopen stores very quickly ― Many states relaxed their regula&ons that impose weight
limits during storms on cargoes that can be transported using highways
― Further, the company’s coordina&on with power companies helped it make apt decisions about where to deploy generators
§ Wal-‐Mart’s Emergency Opera&ons Center—established at its headquarters, post 9/11, to tackle exigencies—played a key role in coordina&ng recovery opera&ons
Hurricane Sandy (2012)
Noble Energy
CASE IN POINT:COMPANIES
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POTENTIAL SOLUTIONS
Governments and businesses should ensure effective implementation of policies and initiatives to mitigate the impact of climate change
Business ConJnuity Plans, to con&nue opera&ons in case of
emergency situa&ons such as natural disasters, criminal offences, and fire
Sustainable Supply Chains, by reducing environmental, risk, and waste costs on
organiza&on’s supply chain DiversificaJon Plans, including opera&onal diversifica&on (spreading opera&ons to mul&ple
geographies) and business diversifica&on (entering new markets to reduce dependence
on a single industry)
Industry-‐level Policies, to ensure strict adherence to industry norms by
organiza&ons opera&ng within those industries
InternaJonal Partnerships, to ensure efficient u&liza&on of knowledge and development of collabora&ve efforts to reduce climate change
impact
Community-‐level Partnerships , to impart trainings to ensure self-‐sufficiency and sustenance during emergency situa&ons,
including natural disasters
Research & Development, to con&nuously innovate and develop beaer methods to adapt to the
rapidly changing climate
Renewable Energy Use, that helps mi&gate climate change
Ethical Sourcing PracJces, by responsibly conduc&ng sourcing ac&vi&es taking into considera&on sustainability and social welfare
Reducing Carbon Footprint, by following the 5R Principle—Refuse,
Reduce, Reuse, Repurpose, and Recycle
Business IniJaJves
SoluOons to MiOgate Impact & Adapt to Changing Climate
Government Policies & IniJaJves
Regulatory IniJaJves, by framing policies, passing laws and developing standards to mi&gate the impact of
climate change
Source: TSC Analysis
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KEY QUESTIONS TO CONSIDER
Your Checklist
Below is a list of queries that senior execuOves, decision makers, and managers globally should reflect on regarding the impact of natural disasters
(due to changing weather pakerns) on their organizaOons’ supply chain
§ Do you operate in geographies that are highly vulnerable to climate change? § Is your organizaJon’s supply chain sustainable in case of a natural disaster, such as flood, cyclone, or
drought? § Do you have a mulJple sourcing strategy in place? § Have you established a business conJnuity plan to miJgate the impact of extreme weather?
§ What are the various steps your compeJtors and the industry are taking to this end? § Are you taking the necessary steps to insulate your company from this risk in the long term?
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