- On 28 February 2022 the Intergovernmental Panel on Climate Change (IPCC) released its latest report, highlighting the causes, impacts, and possible solutions to climate change.
- Findings in the report show that climate breakdown is happening faster than expected and that the window to take action is closing fast.
- The report is a call to governments and private sector players to take drastic action against climate change.
In November 2021, COP26 concluded in Glasgow, Scotland, with the adoption of the Glasgow Climate Pact – a commitment to reach a global net-zero emissions target by 2050. Central to the pact is keeping a 1.5℃ global warming target within reach. Glasgow achieved some progress, but estimates suggest that even if commitments are delivered, the world is headed for 2.4℃ warming.
This week, the IPCC reported that climate breakdown is occurring quicker than anticipated and that, at current levels, many parts of the planet will become unliveable in the next few decades. After reading the report, the UN secretary-general, António Guterres, said: “I have seen many scientific reports in my time, but nothing like this. This is code red for humanity. We must combine forces now to avert climate catastrophe.”
This code red for the climate has come in this midst of the unfolding crisis and humanitarian tragedy in Ukraine, which has also brought to the fore Europe’s complex relationship and reliance on Russian fossil energy sources. The energy insecurity and fear over energy independence caused by the crisis, risks seeing some European nations take actions that could slow the green energy transformation. While the need for an immediate response is clear, an energy secure future must also address the climate crisis.
These warnings, and challenges related to security, energy dependence and climate, are not new. World leaders must exact the transformation needed. The World Economic Forum has a central mission to limit global warming by supporting public- and private sector efforts to take climate action and innovate for climate solutions. Initiatives such as the First Movers Coalition and Alliance of Climate Leaders are moves for drastic action to work side-by-side with governments to accelerate the race to net-zero and commercially scale the right technologies to get us there.
What is the IPCC report?
The IPCC, representing 195 governments, is an intergovernmental body of the UN responsible for providing policymakers with scientific assessments on the risks and implications of climate change. Their reports are peer-reviewed assessments among hundreds of climate scientists and experts. These reports are thorough, science-driven, and unambiguously point to human action as a cause of climate change.
This is the second of a two-part report. The first focused on how anthropogenic greenhouse gasses (GHGs) are responsible for widespread planetary damage, while this report zooms in on the causes, impacts, and possible solutions to climate change. It emphasizes that the window for action to stay in a climate safety zone is shrinking fast.
What happens if we move out of the safety zone?
The report suggests that the world must cut its total emissions by 45% by 2030 to avoid climate catastrophe. At current levels, global emissions will increase by almost 14% over this period. If this is the case, we will have to adapt to irreversible impacts such as melting ice caps, frequent and intense weather events, and immense biodiversity and ecosystem loss. The report finds that almost 3,3 billion people now live in highly vulnerable climate contexts, and the mass die-off of fauna and flora is well-underway.
Small island states, and coastal areas are among the worst affected, with storms and rising sea levels already wreaking havoc. Vulnerable communities are especially exposed: between 2010 and 2020, droughts, floods, and storms killed 15-times as many people in highly vulnerable countries in Africa, South Asia and South America as in wealthier nations.
Worryingly, critical ecosystems are losing their ability to absorb carbon dioxide, turning peatlands and forests from carbon sinks into carbon sources. The thawing of permafrost will release additional GHGs into the atmosphere, accelerating warming.
The skyrocketing financial and human cost of inaction
The report informs us how an already fragile planet and socioeconomic system will become even more unstable if enough isn’t done to curb climate change. The Swiss Re Institute finds that the world stands to lose 10% of total economic value from climate change by 2050 if net-zero targets aren’t met. Asia, which has been the bulwark of economic growth in recent decades, stands to lose 26.5% of GDP by 2050, while Africa and the Middle East could lose up to 27.6%.
A dizzying comparison notes that, at the peak of COVID-19, the global economy shrunk by 5%, while the 2008 financial crisis saw a 1% global shrinkage. Climate and economic crises will also exacerbate food insecurity, poverty, diseases, and ill-health.
Climate migration is already commonplace in many countries, and places like West Africa could see up to 32 million people forced to move by 2050 due to climate factors. Droughts, meanwhile, are becoming the norm for many sustenance farming communities and climate-linked food insecurity is leading to famine.
Unless we collectively undertake a value-based transformational shift to change economic models and policies responsible for these catastrophes, such events will continue to emerge – and worsen in scale.
Accelerating adaptation measures
Developing countries, particularly those in the global south, are hit hardest by climate change. This is widening the economic gap between nations and furthers inequality among peoples.
Only half of IPCC member countries have adaptation measures worked into their climate strategies. These include flood barriers, drought-resistant crops, and early-warning storm systems. The report states that such measures may not be sufficient to prepare for future threats. We need total transformational change in our planning, building, consuming, and systems. Mr Guterres, for his part, says that “As climate impacts worsen, scaling up investments will be essential for survival. I’m pushing for 50% of all climate finance to go to adaptation.”
The report admits that we’re already gone past some tipping points. COP27, to be held in Sharm el-Sheikh, Egypt, later in 2022, will certainly draw the spotlight to scaling up finance for adaptation. This IPCC report shows just how critical this will be.
Companies, too, must have adaptation plans in place, incorporating both a risk and opportunity lens. From a risk management perspective, insurance companies are already paying record claim amounts, with US insurers forking out $42 billion for natural disaster damages in the first half of 2021. With insurance companies ramping up their risk estimations, companies across all industries must adjust their climate strategies accordingly to respond to emerging risks.
In as far as opportunities are concerned, companies have an important role to play in supporting a just climate transition through their global value chains by collaborating with suppliers in vulnerable markets – both supporting them in adapting to the certain impacts of climate change while also future-proofing and building resilience into operations.
The race to net-zero is a massive opportunity
Humankind has a unique ability for cooperation, especially when the odds are stacked against us – the speed of COVID-19 vaccine development is evidence hereof. Climate change will be an even larger opponent, and the net-zero drive will require unyielding leadership and effectual technologies.
Through its Alliance of CEO Climate Leaders, the World Economic Forum has already joined over 120 companies with $7.8 trillion in assets to net-zero pledges. The IPCC report underlines that action must be taken today to achieve net-zero targets. Ahead of COP27, a central narrative for clean-tech investment and innovation must form. Big polluters, especially, should turn climate pledges into innovative action. Public-private partnerships to lower emissions and drive green innovation will go a long way in fighting climate change. The US government is committing billions to develop and adopt clean technologies, alongside private sector players.
Toward climate-resilient development pathways
The IPCC is blunt in its warning: if we continue to follow the current pollutive economic model, things will get much, much worse for the planet and humanity. The flip side is that if we do take drastic action and the public and private sector tag-team in the boxing ring against this formidable opponent, we can turn this crisis into an opportunity.
Climate-resilient development means putting adaptation and mitigation next to each other while stressing sustainable, inclusive development. Key players, including governments, leading businesses, the finance community, indigenous knowledge holders and community leaders, should have a shared vision of how we can not only bring climate change to heel but create a world that is safe, stable, and just.
The World Economic Forum informs its climate action with this same integrated lens: solutions must take into consideration nature, land use, oceans, and climate, as part of an integrated framework to protect our life on this planet.
Antonia Gawel, Head, Climate; Deputy Head, Centre for Nature & Climate Member of the Executive Committee, World Economic Forum
Nathan Cooper, Lead, Partnerships and Engagement Strategy, Climate Action Platform, World Economic Forum
Lukas Bester, Researcher, Writer, Sustainable Development Consultant in Emerging Markets
This article previously appeared in the World Economic Forum.