It is possible to quantify the benefits of adaptation measures for corporate use, although it can be challenging due to the complex and often indirect nature of these benefits. Some of the benefits of adaptation measures that may be of interest to companies include:
- Reduced risks: Adaptation measures can help to reduce the risks posed by climate change, such as the risk of damage to infrastructure, supply chain disruptions, or legal liabilities. By quantifying these risks, companies can determine the potential benefits of adaptation measures in terms of reduced risk.
- Improved efficiency: Adaptation measures can also improve the efficiency of operations, such as by increasing the resilience of infrastructure or by reducing the need for costly repairs or replacements. These benefits can be quantified in terms of reduced costs or increased profitability.
- Enhanced reputation: Companies that take action to adapt to climate change and reduce their carbon footprint may be perceived more favorably by consumers and stakeholders, which can have a positive impact on their reputation and brand value.
To quantify the benefits of adaptation measures, companies may need to conduct a risk assessment to identify the potential impacts of climate change on their operations and supply chains. They can then use this information to estimate the potential costs and benefits of different adaptation options and choose the most cost-effective options. It may also be useful to engage with external experts or use specialized software tools to help with this process.
This is especially true in the climate markets that represent a very new sector of assets. While we have been developing renewable energy solutions for decades, the carbon markets, for instance, have only gained traction among the typical investors over the last two years or so. The fledgling market, while new, has been boosted through an extremely rapid growth cycle. While the market is growing, the information available through public channels still remains very fragmented. The products are well documented, but present high risk to those entering from outside the markets due to the complexities in the characteristics of environmental assets. Quality criteria misjudgements can lead to counter effective results and high asset risks, especially now when actors in the sector are increasing scrutiny on greenwashing, environmental claims, and viability of projects.
