New Climate Change Report Rates Political and Regulatory Environments as Top Concerns by Corporate Risk Managers
A survey of risk managers on how climate change risk is perceived and dealt with by their businesses, released this morning, reveals the political and regulatory environments are top concerns among risk managers, survey sponsor Zurich Financial Services Group announced today. The survey, analyzed and reported by the Boston-based investor and environmental sustainability network Ceres and administered jointly with the Professional Risk Managers International Association (PRMIA), sheds light on how 200 risk managers view climate change and its potential impact on their industries.
The findings were announced today at a news conference held during the 2010 Risk & Insurance Management Society (RIMS) Conference and Expo in Boston and are detailed in the report, “Climate Change Risk Perception and Management: A Survey of Risk Managers.”
"Risk managers at companies play a crucial role in helping businesses understand how their risk exposure may be changing," said Ceres President Mindy Lubber, speaking at a news conference today in Boston. "They can also help insurers create products and services that help address those needs. So this survey is a perfect example of how insurers can play an active role in helping companies, all across the economy, understand and manage this fast-evolving climate issue."
Some key findings include:
- Thirty percent of risk managers surveyed said climate change regulation was one of the top five risks facing their company
- Risk managers are aware of climate risk
- Strategies regarding how best to mitigate climate risks are uneven
“It’s clear that risk managers are conscious of risks posed to ‘business as usual’ by climate change. Now it is time to convert that knowledge to risk management action,” said Lindene Patton, chief climate product officer for Zurich Financial Services Group and participant in today’s news conference. “It is fitting that we are announcing the results of this informative survey at the RIMS conference, where industry professionals are gaining awareness around emerging risks like climate change. Zurich is redoubling its efforts to make certain risk managers understand the potential impacts to their businesses, and working to offer solutions to help them mitigate such risks associated with climate change.”
The survey captured the opinions of risk managers from the following industries and business sectors: financial services, insurance services, high-emitting, health, medical, government agencies, agricultural, and food/beverage. Nearly 60 percent of the survey respondents represented financial or insurance services or high-emitting industries.
According to Sohayla Fitzpatrick, steering committee member of the Boston chapter of PRMIA who spoke at the news conference, the survey is a first step in helping risk managers, capital providers, and insurers to better understand climate risk perception and what role internal risk management and external risk transfer can play in mitigating such risks.
Based on the findings of the survey, the analysis recommends risk managers take the following steps to understand what these evolving risks mean for their business:
- Tap into emerging expertise on evolving climate risks to understand their possible exposure,
- Communicate to all critical decision makers their organization’s potential exposure to climate risk, and
- Consider whether the management structures and performance metrics in their organization are adequate for managing emerging climate risks.
To access the full report, go to http://www.zurichna.com and click on the ‘Media’ tab.
Zurich in North America is a part of Zurich Financial Services Group (Zurich), an insurance-based financial services provider with a global network of subsidiaries and offices in North America and Europe as well as in Asia Pacific, Latin America and other markets. Founded in 1872, the Group is headquartered in Zurich, Switzerland and employs approximately 60,000 people serving customers in more than 170 countries, including more than 9,500 employees in North America.
Zurich was the first overseas insurer to enter the U.S. market in 1912. According to Highline Data LLC (NAIC 2008), Zurich in North America (www.zurichna.com) is the second-largest writer of commercial general liability insurance and the fourth-largest commercial property-casualty insurance company, serving the global corporate, large corporate, middle market, specialties and programs sectors. Zurich's risk engineering services in the United States are provided by Zurich Services Corporation.
Ceres is a national network of investors, environmental organizations and other public interest groups working with companies and investors to address sustainability challenges such as global climate change.
The Professional Risk Managers' International Association (PRMIA) is a higher standard for risk professionals, with 60 chapters around the world and more than 67,000 members from 198 countries. A non-profit, member-led association, PRMIA is dedicated to defining and implementing the best practices of risk management through education including the Professional Risk Manager (PRM) designation and Associate PRM certificate; webinar, online, classroom and in-house training; events; networking; and online resources. More information can be found at www.prmia.org.