Addressing climatic risk factors is an important step towards business resilience
Customer
The company carries out diversified activities for the extraction and processing of hydrocarbon raw materials, sells finished products; also works for export.
The company takes an active position in the field of climate:
- supports implementation of The Paris Agreement and the Concept for the Formation of a System for Monitoring, Reporting and Verifying the Volume of Greenhouse Gas Emissions in the Russian Federation;;
- applies in its work the corporate standard for the control and accounting of greenhouse gas emissions, based on the principles of the current legislation of the Russian Federation and international recommendations;
- participates in the disclosure of climate data on international rating platforms;
- works with climate risks.
Problem
The company understands that it directly depends on climate change: natural characteristics affect production assets, infrastructure, and changes in regulatory and regulatory legislation in the climate sphere affect business processes. Cases of destruction of the company's facilities are becoming more frequent (especially in the permafrost zone), and the competitive component of climate regulation is increasing. All of these trends require a deeper understanding of how and to what extent climate change affects the efficiency and sustainability of a company.
The management turned to our organization for help in identifying climatic factors (natural phenomena and legislative processes in the external environment) that create the greatest risks in its production processes, in transport operations, logistics, supply and marketing, etc. factors and identify which processes of its activity are most sensitive to them.
Solution
Climate change is diverse. They have different intensity, direction of action, manifestation in a specific situation (geographic, economic, political, etc.) Therefore, it was important to reduce the level of uncertainty and adopt optimal analytical generalizations in order to obtain correct and relevant results.
We found that the climate has a significant impact on the sustainability of the company's production facilities, especially those located in high latitudes, and changes in regulatory and regulatory legislation in the climate field directly affect the Company's business processes.
Working with trends in climate parameters and prospects for climate regulation, we used officially recognized climate change scenarios (Intergovernmental Panel on Climate Change, International Energy Agency, etc.).
We identified all the factors of climatic risks that are significant for the company: physical and transient. Using a special algorithm developed by us, we analyzed the found factors and assessed their impact on the company's processes in terms of sustainability in the long term.
We also gave recommendations on how to reduce the impact of climatic factors in the development of design and working documentation.
Result
The company has gained a new understanding of climate risks, which allows:
at the design stage, take into account the tendencies of changes in physical climatic factors;
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strategically plan and act in the climate field (climate strategy, low-carbon transition plan);
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refine climate scenario analysis;
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make adequate decisions on climate risk management (including their identification and assessment);
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improve the quality of investment policy and current investment.
Understanding the significant climatic factors and their impact on efficiency and sustainability is the basis of the climatic activities of any company, territorial authorities, investors.
Email us and find out what you can do today to manage the risks of climate change
