Why you need climate intelligence in your 2023 ESG budget

That’s why it is crucial that decision-makers include investment in climate intelligence (CI) into their 2023 budget. Our Founder and CEO, Iggy Bassi says: “Climate intelligence puts climate at the core of decision-making. Enterprises, governments, and NGOs use it to make climate-aligned decisions.” And, with the World Meteorological Organization (WMO) warning that “climate-related disasters have increased fivefold over the past five decades and are costing $200 million a day. we all need to be making climate-aligned decisions today, in 2023 and beyond. To do this, decision makers need climate intelligence.

Climate intelligence (CI) is asset-level intelligence on climate risk to inform decision-making. It provides decision-ready insights and granular analysis of comparable climate risk ratings across a portfolio of physical fixed assets such as offices, factories and power plants. This can cover both company-owned assets and those they depend on in the supply chain. But what kind of insight can be gained?

Decision-makers can benefit from intelligence on long- and short-term climate risk, how climate risk changes across multiple climate scenarios and the different climate hazards their assets are exposed to. This information means that ESG leaders can feel confident they have accurate, science-backed climate risk insights when reporting on climate risk which can inform effective and targeted resilience plans.

The cost of not planning for climate hazards can be devastating. For example, industries such as pharmaceuticals can be severely affected, as droughts can lessen the water supply that’s so essential to water-intensive industries. In 2021 weather and climate-related events cost the global economy USD329 billion. Inaction is not an option.

The world is changing rapidly and climate change should be a priority for all businesses – financial assets worth an estimated USD2.5 trillion are at risk, globally. Managing these risks through robust ESG budgeting is critical.

We’ve all seen the recent global heatwaves, flooding, and droughts and the damage that ensues. The trail of destruction includes ruined infrastructure and buildings, supply chain and transport chaos, and business closures. As part of risk management, organizations are required to report their exposure to climate hazards. Investment is needed to climate-proof businesses or a portfolio of assets, and it saves the damage that could occur without any planning for it.

Getting granular insights into physical climate risks is essential today and in the future. Climate intelligence provides the decision-useful insights that organizations need for their future strategy. The most important takeaway is that by allocating a budget for climate intelligence, businesses are future-proofing and building robust plans against extreme climate events in 2023 and beyond.

Your ESG budget is not finalized without climate intelligence - it must be a priority. Now more than ever, organizations need detail and insight into future climate risk. Climate change cannot be underestimated. Cervest’s climate intelligence product, EarthScan™, provides companies with the most comprehensive view possible of physical climate risk – on-demand and at the asset level.

McKinsey says that climate-proofing your assets provides a 4:1 return on investment. Using our climate intelligence product, EarthScan, is an effective way to find out where and when to climate-proof – it can span an entire portfolio of assets and suppliers. A vital technology in an organization’s 2023 ESG budget – costing you less overall.

Download our comprehensive e-book: Why you need climate intelligence in your 2023 ESG budget – for deeper insights.