Risk Assessments: Climate Change's Networked Effects

Risk Assessments: Climate Change's Networked Effects

Risk Assessments: Climate Change's Networked Effects

In September, the Securities and Exchange Commission (SEC) sent letters to dozens of public companies asking them to provide more information to investors about how climate change might affect their financial earnings or business operations. The letters were sent to firms in industries including agriculture, oil and gas, banking, real estate and trucking. Then, in early October, the White House released the climate adaptation plans for 23 U.S. government agencies, including Energy, Defense, Agriculture, Homeland Security, Transportation and Commerce. The documents included information on the dangers that climate change could pose to almost every industry, as well as society at large. The SEC request and the White House plans illustrate that the effects of climate change are not linear but rather are networked, with impacts far beyond the prevention and cleanup of the next hurricane, drought or fire. Yet the fact that the SEC didn’t send letters to every public company also suggests that while the cascading challenges that come from climate change are starting to become recognized, the pervasiveness of the effects are not. While some of climate change’s networked effects are still theoretical, the impacts of global warming are already being felt in areas including energy and power generation; mining; food and beverage; infrastructure; logistics and trade; travel and leisure; and mental health. 

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