More than 200 of the biggest global companies around the world have calculated $1 trillion is at risk from climate change risks — many of which are likely to become reality within the next five years, according to a climate change report released by CDP on June 4.
The 215 companies represent nearly $17 trillion in market capital.
According to CDP, $500 billion of the projected costs would come from major climate impacts, including extreme weather patterns, rising global temperatures and increased pricing of greenhouse gas emissions.
Such companies also predict losses could total another $250 billion due to stranded assets, including fossil fuel assets that may no longer offer economic returns, or companies that are significantly exposed to the physical impacts of climate change.
“The goalposts for climate action have never been clearer for companies,” said Nicolette Bartlett, CDP director of climate change. “Our analysis shows that there are a multitude of risks posed by climate change, including impaired assets, market changes and physical damages from climate impact, as well as tangible impacts to business bottom lines.”
On the other hand, climate change also could generate $2.1 trillion in business opportunities, nearly all of which are highly likely or virtually certain.
Additionally, at $2.1 trillion, the potential value of climate-related opportunities is almost seven times the $311 billion cost of achieving them. Given this, investors and stakeholders could expect to see a significant shift in climate-friendly products and services from the world’s largest companies.
The report is based on responses from 6,937 companies that responded to CDP’s climate change questionnaire in 2018, as well as 366 respondents from of the world’s 500 biggest companies.
To read the full report, click here.