It’s no secret that climate change is having an extreme impact on some of the most vulnerable parts of the world. There are areas where the opportunity for relief and aid are often few and far between, where fundamental resources – clean water, food, shelter and medical help – are hampered by lack of access, conflict, or insufficient funding, and where the economy simply isn’t equipped to recover from a profound loss of infrastructure.
Most of these areas feel very remote to those of us who are based in the UK but, even still, the climate crisis has made itself known on our shores. The wildfires that spread across parts of the UK in 2022 – most memorably, perhaps, in East London’s Wennington – marked a grim turning point, with more than 4,000 serious blazes recorded between July and September. Wetter winters have given rise to catastrophic flooding in recent years, and researchers are foretelling a future of astronomical flood damage bills some 20% higher than they are right now.
Now, none of us can say that we are totally detached from the climate crisis – and most of us are acutely conscious of the ways, however subtle, it makes itself known, whether in the headlines or in our day-to-day reality.
As the outcomes of global warming grow more diverse, so too does the list of individuals and businesses directly affected by them. A recent survey published by Gallagher found that almost half (48%) of UK businesses have been impacted by the climate crisis in some way or another.
Changing Customer Priorities
This is, ultimately, a positive outcome – although it may not always feel that way for businesses that have, historically, managed to get by with little worry for their carbon footprints.
The past few years have seen a tremendous upsurge of interest from consumers looking to align themselves with more environmentally conscious brands. Thousands of businesses have responded, from switching to eco-friendly packaging (in 2022, for instance, McKinsey found that 75% of organisations have committed to more sustainable packaging alternatives) to maximising reliance on sustainable sources. Commercial solar installations on farms, offices, and production facilities have grown tremendously, along with the number of businesses changing the ways in which they acquire resources.
The Coventry-based water company Severn Trent, for instance, now utilises 85% renewable energy, with plans to reach net zero carbon emissions by the turn of the decade. From North Lincolnshire, biotech company Toraphene are revolutionising product packaging with a fully biodegradable and compostable plastic alternative. The London-based B-Corporation Wild have diverted 80 tonnes of throwaway deodorants from landfill. The list of sustainable UK-based brands grows longer (and more diverse) every day.
Of course, progress isn’t linear. Just recently, the true extent of companies greenwashing their unhealthy and unproductive practices in order for them to profit off the consumers looking to make positive changes came to light. In response, the EU introduced new regulations with proportionate penalties promised to those who are caught intentionally misleading customers.
The sustainability trend is no longer a trend, and it’s safe to say that customers will continue to require more and more commitment from brands who want to dominate their market.
Disruptive flooding, storms, and heatwaves (themselves leading to wildfires) are all part and parcel of global warming. We’re seeing an increasing number of extreme weather events worldwide.
Carbon Brief recently examined 504 extreme weather events from around the world, and found that the likelihood or severity of more than 70% of those events were directly increased by humans. 152 of those events included extreme heat, and 93% of scientists found climate change was behind their likelihood and/or severity.
Last year saw the hottest summer in the UK since records began almost 140 years ago. The risk to health and wellbeing – and, due to the increasing risk of wildfires, personal safety – means that more businesses are impacted by UK heatwaves than ever before.
When the summer has passed, wetter winters and unpredictable fluctuations between dry spells and heavy rainfall mean flash flooding disrupts business continuity, along with sudden snowfall – causing blackouts and fuel shortages.
Supply Chain Issues
Despite increased flooding, wildfire risk, and snowfall, it remains the case that the UK is relatively safe from many of the natural disasters global warming is causing. But, these days, with such high levels of globalisation, it doesn’t take long for the impacts of a natural disaster half the world away to be felt closer to home.
From agriculture to tech, no industry is truly safe from the devastation that can be wrought by storms, cyclones, hurricanes, fire, and floods. While the event itself was not a result of global warming, the obstruction of the Suez Canal in 2021 is demonstrative of how globally a single, localised issue can be felt.
Earlier this year, issues with growing conditions in Spain and Morocco led to a widespread shortage of tomatoes in Britain. While the stakes were low in this instance, it should serve as a reminder of how quickly businesses can be impacted by issues that take place thousands of miles away.
Increasing Operating Costs
Global warming is expensive. Or, more accurately, operating a business during a time of unpredictability, fuel shortages, disrupted trade routes, and higher penalties for carbon contributors is expensive.
There are plenty of businesses and individuals who are (unfortunately) able to generate a stronger, healthier profit the more the climate catastrophe takes hold. Global warming tends to benefit wealthier nations in general, and force poorer nations to remain in tenuous positions both economically and socially. Nevertheless, the UK is home to plenty of businesses that will struggle to survive in the face of increased operating costs.
Economic models of climate change paint an ever more worrying picture. As natural resources grow more valuable and rising fuel costs make long supply chains (at times, unavoidable) more and more expensive, companies will need to curb their operations or risk razor-thin margins. Even the added expenses of running air-conditioning in the summer and decreased productivity from workers will drive-up operating costs, and squeeze many smaller businesses out of the market entirely.
Damage to Assets
Physical assets can easily be destroyed by global warming factors. Flooding and fire are the most obvious risks, but even a relatively low increase in temperature puts stock at risk. According to one estimate, a rise of just 4°C above preindustrial levels could cause economic losses to total more than $20 trillion each and every year – something that will have an unprecedented impact on the global market.
Interestingly, Gallagher also found that, already, 15% of UK businesses have moved premises as a direct result of climate change. As more parts of the country come under threat of flooding, or become untenable as a result of the increasing cost of supply chains and operating, it looks certain that relocation due to global warming will become a familiar part of everyday life in the UK.
The extent to which businesses are impacted by climate change depends on industry. At present, the hardest hit are tourism and hospitality, banking, and retail. Supermarkets are already blaming rising costs on global warming and, given the sheer number of ways climate-related disasters can impact supply chains and costs, it’s not hard to see why. Imported foods like coffee and chocolate come with very long supply chains, and the future will raise plenty of questions about whether or not we should sustain our reliance on these products when the supply chains not only threaten to exacerbate the climate crisis, but also suffer directly as a result of it.
One thing is for certain: we can expect more and more elements of daily life to be altered as a result of global warming, and for it to continue growing more difficult to ignore the ways in which the climate crisis is washing up on our shores.
The best thing any business can do, whether UK-based or international, is invest in a more sustainable operational model. From the ways in which we power our office buildings to the ways in which we care for the soil in which our food is grown, or the air into which by-products of mass production like CO2 and nitrogen are pumped, we all need to look for better ways to be in the years to come.