Managing Climate Risk

Though not all of the future consequences of climate change are known, the range of realistic outcomes is deeply worrying. That is why the latest report from the Intergovernmental Panel on Climate Change explicitly frames the issue as a risk-management challenge.

YOKOHAMA – We live in an era of human-induced climate change. Though not all of the future consequences are known, the range of realistic outcomes is serious – and a scenario in which there is no impact from climate change is so unlikely that it can safely be ignored. The risks – to commerce, societies, and the environment – are pervasive.

Investments in managing those risks can be effective and affordable. Indeed, some of the most appealing responses are relatively inexpensive. Others, which require more resources, can be developed as investments that not only provide protection from climate change, but also advance competitiveness, development, and security.

The latest report from the Intergovernmental Panel on Climate Change, released today, explicitly frames the issue as a risk-management challenge. This approach facilitates a balanced consideration of likely outcomes as well as those that are less likely but imply much graver consequences. It also capitalizes on sophisticated tools and approaches already widely used for managing risks in endeavors as diverse as national security, financial planning, and infrastructure design.

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