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Managing climate risk
How geospatial data and analytics can help you minimize environmental impacts and business risk
Climate change is an existential threat that must be addressed now. It’s placing extreme stress on a wide range of species and habitats—and the economic impact is also mounting. In the US alone, the 20 biggest weather and climate disasters of 2021 collectively caused USD 145 billion in damage.¹
Fortunately, the world is beginning to realize that it’s time to do something because the risk of doing nothing is too high. Respondents to the World Economic Forum’s Global Risks Report 2022 ranked climate action failure as one of the most severe risks we face over the next decade.² And businesses have gotten the memo. They know they have to address the risks that climate change poses to their operations—and they have to reduce their own environmental impact.
But what are the next steps? How do you actually prepare for the impact of climate change? Let’s look at how you can better understand the risks you face and what actions you can take to mitigate those risks—for your business and for the planet.
20 billion-dollar weather and climate disasters occurred in 2021 in the US alone.¹
Climate change and severe weather events are taking a growing toll on business operations. Everything is at risk—from buildings and assets to supply chains, infrastructure and employees. Understanding the scale and nature of the risk is critical. To achieve this goal, businesses must be able to:
- Model and predict the potential impacts of climate change and weather events across the organization.
- Locate, predict, prepare for and monitor the impact of extreme conditions, such as storms, wildfires, flooding and air pollution.
- Make the right decisions at the right times to protect the organization and its stakeholders from the impacts of climate change and severe weather
- Understand the organization’s own contribution to climate change and take effective steps to minimize or even reverse it.
These points are easy to list, but hard to act on. Why? Because truly understanding your climate risk means collecting and analyzing some of the largest data sets imaginable.
Think of all the geospatial data that comes from satellite monitoring of the Earth. Add in global weather forecast data. Then consider all the data your organization generates about your assets, facilities and infrastructure. Now add carbon emissions data from across your organization and supply chain. The result—enormous, continually updated data sets that are too big to move.
Luckily, most organizations are starting this journey. In 2019, 96% of executives we surveyed told us they already incorporate weather data into their operational planning. But using that data to model, predict and act on climate risk requires new tools, technologies and expertise.³
Understand and address climate risk with IBM Environmental Intelligence
IBM has developed the IBM® Environmental Intelligence, a powerful, comprehensive solution to help organizations understand and mitigate climate-related business risks, including extreme weather, climate action failure and human-led environmental damage. IBM Environmental Intelligence is cloud-based, AI-powered software that bridges the gap between climate science and business operations. It combines a powerful geospatial analytics engine with a climate and environmental impact modeling framework so you can:
- Predict the risk of climate change and upcoming weather events to your business operations. In retail, for example, it could mean using future flood risk predictions to inform store location planning.
- Understand the overall impact of weather and climate change on the business. For an electrical utility, knowing the rates at which vegetation is likely to grow along the grid network can help with vegetation management planning.
- Protect your assets and ensure business continuity before, during and after a severe weather event. For instance, proactively identifying and prioritizing the right actions to take in the event of severe weather disruptions can give you time to organize alternative logistics routes.
- Mitigate risks by taking the right actions at the right time to minimize economic and environmental damage from severe weather events. An insurer, for example, could send an short message service (SMS) alert advising policyholders to move their vehicles ahead of a predicted hailstorm.
- Manage your carbon footprint by understanding your organization’s scope 1, scope 2 and scope 3 carbon emissions. By doing so, you can model your energy supply to help navigate and accelerate you transition to renewable energy.
- Improve real-time decision-making to reduce costs, improve efficiency and contribute to sustainability goals.
IBM Envizi supports GHG calculations for scopes 1, 2 and 3, and flexible reporting tools to meet internal and external ESG and sustainability reporting requirements.
A global leader
IBM Envizi recognized as a global leader in enterprise carbon management software, scoring highest for carbon management capabilities and market momentum in the Verdantix Green Quadrant for Carbon Management Software 2022.
Direct emissions, such as those emissions generated by company vehicles, manufacturing processes, and onsite fuel combustion
Indirect emissions from the consumption of purchased electricity, heat or steam that are purchase from other entities
Emissions that are generated by organizations and activities in the supply chain that are outside of an organization's direct control
Powerful capabilities for energy and utilities
Energy and utilities companies are among the most exposed to climate risk—and they play a key role in the transition to renewable energy. IBM Environmental Intelligence includes optional add-ons for these critical sectors, allowing you to:
Case studies
Climate change makes weather harder to predict. See how Yara has built a predictive data platform for farmers around the world, helping them plan, sow, manage and harvest for optimum yields.
See how Energinet, an independent public enterprise owned by the Danish Ministry of Climate, Energy and Utilities is harnessing the predictive capabilities of IBM Environmental Intelligence to help achieve their goal of 100% renewable energy generation by 2030.
Footnotes
¹ 2021 U.S. billion-dollar Weather and climate disasters in historical context (Link resides outside ibm.com), NOAA National Centers for Environmental Information, 24 January 2022.
² The Global Risks Report 2022 (Link resides outside ibm.com), World Economic Forum, 2022
³ Just add weather – How weather insights can grow your bottom line, IBM Institute for Business Value, May 2018.
