Climate risk assessment

The Climate Risk Assessment service is generally designed to assess the current and future impacts of climate change on a specific organisation, community or project. This assessment aims to identify potential vulnerabilities and adaptations needed to reduce climate-related risks. With the entry into force of the European Directive 2022/2464 (CSRD), risk management becomes central, to be carried out according to the principle of dual materiality and with a forward looking approach.

In other words, companies are called to identify and manage not only the environmental and social risks-impact of their business, but they must look to the future, to the probable and potential evolutions of the social, environmental and economic context, identify the consequent risks and manage them, or plan suitable measures for their prevention and mitigation.

ANALYSIS AND ACTIONS

ASACERT’s specialized technicians will be able to carry out an accurate assessment of the main risk factors to identify future scenarios and plan a strategy to evaluate actions for adaptation under continuous monitoring to evaluate the effectiveness and adjustments of actions, if necessary.

• Analysis of Greenhouse Gas Emissions: Evaluation of greenhouse gas emissions produced directly or indirectly by the organization’s activity. This may include analysis of manufacturing activities, transportation and other sources of emissions.
• Climate Vulnerability Analysis: Identification of the organization’s specific vulnerabilities to climate change. This could involve assessing potential climate-related threats, such as floods, droughts, heat waves, etc.
• Future Impact Scenario: Examination of future climate projections and their potential impacts on the organization. This may include analyzes of climate models to understand how climate conditions may change over time.
• Planning for Adaptation: Developing strategies and plans to mitigate identified climate risks. This could include specific actions to reduce greenhouse gas emissions, improve resilience to climate disasters or adopt sustainable business practices.
• Continuous Monitoring and Reporting: Implementation of monitoring systems to constantly evaluate the effectiveness of adaptation measures and to make any updates in response to ongoing climate changes.
• WHY THE CLIMATE RISK ASSESSMENT
• The benefits of a Climat Risk Assessment go beyond the need to comply with relevant regulations:
• Vulnerability Identification: the process allows you to identify the specific vulnerabilities of an organization or community with respect to climate change. This is essential to understand where problems may arise and where corrective actions are needed.
• Planning for Adaptation: Climate risk assessment provides a basis for developing adaptation strategies and plans. Organizations can plan targeted interventions to reduce risks, improve resilience and protect their operations against climate impacts.
• Risk Management and Business Continuity: Understanding climate risks enables organizations to implement risk management practices. This helps ensure operational continuity even in the presence of extreme climatic events, reducing potential interruptions and economic losses.
• Corporate Reputation and Social Responsibility: Addressing climate risks demonstrates a commitment to environmental sustainability and social responsibility. Organizations that take concrete steps to mitigate climate impacts can enjoy a better corporate reputation and stronger relationships with stakeholders.
• Sustainable Investments: Investors, financiers and insurers are increasingly considering climate risks in their investment and financing decisions. Organizations that understand and effectively manage these risks can benefit from improved financing and investment opportunities.
• Preservation of Natural and Environmental Resources: a careful approach to climate risks helps preserve natural resources and the environment. This helps mitigate the negative impact of human activities on the climate and ecosystem.

ASACERT

Following an assessment, i.e. an analysis of the organizational context, which extends to the entire supply chain and stakeholders, ASACERT technicians carry out an initial assessment of the risks and their weight, identify specific KPIs suitable for measuring their impacts, proceed then with the actions that the organization will have to plan for the prevention and mitigation of risks-impacts, in order to develop a solid ability to manage the risks linked to climate change.

IN CONCRETE YOU NEED:

1. Identify the risks, for example the risk of high temperatures which can lead to interruptions in energy supply and suspension of work, rather than the risk of flood events which can also affect structures, communication routes and people, with consequent risks of serious damage to people and things and to business continuity itself;
2. Prioritize the risks by evaluating the probability of the event occurring and the extent of the consequences for the company, on the one hand, for people and the environment, on the other, in order to assign each risk its own value in terms of gravity;
3. Identify, plan and implement adequate (depending on the degree of severity of the risk) prevention and mitigation measures for the risk and its impacts.

This essentially consists of ‘risk management’ and this is what is required not only by the new European legislation, but also and above all by the current socio-environmental context, to guarantee the sustainability, sometimes the very survival, of the company. For the purposes of correct risk management practice, it is essential to have a real climate change risk management policy.

Following an assessment, i.e. an analysis of the organizational context (which, it is worth remembering, is not limited to the company perimeter, but extends to the entire supply chain and the main stakeholders), an initial ‘materiality’ analysis is carried out of the risks (evaluating their severity as mentioned), specific KPIs are identified suitable for measuring their impacts (returning to the previous examples, the days of interruption of production or suspension of work activity, the days of interruption of supplies, delays in deliveries etc.) to then outline the steps, measures and interventions that the organization will undertake to prevent and mitigate such risks-impacts, in order to develop a solid capacity to manage the risks linked to climate change.

Through the policy, its dissemination and adequate training and monitoring regarding its correct implementation, the organization is put in a position to effectively manage and reduce risks, becoming not only more resilient, but also developing innovation that in the medium-long term guarantees sustainable growth and increases competitiveness.