Private sector’s wish-list for climate risk data

By Chen Chen, Research Scientist, Notre Dame Global Adaptation Initiative (ND-GAIN)

Funded by a two-year Partnership Development Grant from Canadian Social Sciences and Humanities Research Council, McGill University-based Adaptation Tracking Collaborative gathers partners from Wageningen University, UCLA, and ND-GAIN to develop conceptual, methodological, and empirical approaches for tracking adaptation across scales. Since September 2016, the collaborative has surveyed private sector stakeholders to understand the private sector adaptation tracking needs and perception. The survey seeks to collect comments on existing metrics and to build a “wish-list” by which private sector stakeholders believe adaptation tracking would be valuable to facilitate their resilience investment. The collaborative carried out the survey covering a spectrum of private sector industries, including (re)insurance, manufacturing, consulting-service, legal-service, and rating company.

The survey seeked private sectors’ opinions on national-level adaptation tracking metrics. While most private sector stakeholders did not see a national level metric as having a direct impact on their work, they welcome the additional information curated by this metric, which may be used to create future opportunities by influencing policy on a higher level.

In the “wish-list”, the survey brings to light a few things that private sectors believe are necessary for successfully indicating climate risks and facilitating resilience investment.

First of all, companies welcome assessments, updates and communications from governments regarding weather-related risks. This is considered especially helpful for manufacturing companies whose core business does not produce such knowledge. Companies spoke to the needs for public sectors to update the risk data and information as climate brings changing risks to local businesses’ existing facilities. It is crucial for companies to be informed and updated when disaster happens; but it is also important, as companies think, to be informed when climate stresses are being materialized so that assessment of climate risks can be factored into the operation of the businesses. This is key for those companies that have no close liaison with the localities where their businesses operate. A public-private partnership is crucial to produce and disclose risk information and facilitate with non-local businesses.

Second, some companies, whose core business includes production of risk knowledge and information, do analytics via combination of the satellite data or on the ground proxy data to model climate risks. Both have high requirement on data collection methods and devices. Therefore, companies see less data gap from the weather peril side of the business in the more developed market, but data from the “new market”, in developing countries or emerging markets where many supply chains are present, can be missing. This is particularly challenging considering the risk data does not usually come from a single source. Availability of risk data in new markets means data should be available on hazard types and intensity, exposure of assets and human resources, and vulnerability to the exposed hazard, all in comparable resolution.

Third, companies that are specialized in data analytics appear to have higher requirement on data. National-level data or metrics may not be considered useful according to a few cases that the research team heard about. Data intelligence businesses are keen to high-resolution data, for instance, on weather forecasting services, that allow forecasts on 1km-sq grid, 24 hours, and for 10 years. The data with this degree of precision would be especially meaningful to make resilience plan for companies with particular assets in particular locations. Even though there are tools available to do this, the team noted private sectors desire for a high-resolution risk assessment on “a systematic basis”, to break down risks for “individual properties or businesses”.

Right now, a suite of existing open-source metrics have the potential to be used, either by government to provide risk knowledge or by private sectors to collect risk information. These metrics are at the national level (e.g. Adaptation Initiatives Index, Environmental Performance Index, ND-GAIN Country Index), and subnational-level tracking metrics are largely lacking (with exceptions like the community-level tracking system for particular sector, e.g. adaptation tracking for community-level watershed development in India). This leaves a gap for M&E and measurement experts, to create scalable frameworks with concrete, measurable indicators and populate them with higher-resolution data to facilitate the resilience investment of private sectors. 

To learn more about the Adaptation Tracking Collaborative, please visit http://trac3.ca.