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“Climate change will grow in importance for risk managers as the fight against global warming intensifies following the latest report of the Intergovernmental Panel on Climate Change (IPCC),” according to Marie-Gemma Dequae, president of the Federation of European Risk Management Associations (FERMA).
“As companies implement technologies and practices to respond to climate change, so risks will change at an operational level and engage an increasing number of risk managers,” she explained. “The IPCC report also shows that there will be many opportunities for businesses to develop products and processes that improve energy efficiency and reduce greenhouse gas emissions. Risk management is critical to the success of such projects.”
The statement from FERMA, an umbrella organization that represents the risk management associations of 13 European countries, highlights the significance of the latest IPCC report (See IJ web site May 7). FERMA’s bulletin notes that, according to the IPCC’s findings, “improvements in services and facilities that all large businesses use, such as transport, buildings and waste management, can help reduce emissions of greenhouse gases, which are contributing to a warming of the planet.”
In an informal survey FERMA conducted earlier this year the organization found that, although climate change was not an immediate priority for the majority of the 39 European risk managers who responded, many expected more pressure to improve energy efficiency and decrease emissions of greenhouse gases, such as carbon dioxide.
Ms. Dequae, an economist by background, also welcomed the emphasis by the IPCC on the use of a risk management process for decision making about the appropriate level of global mitigation measures in the fight against global warming. The IPCC’s report stated: “Decision making about the appropriate level of global mitigation over time involves an iterative risk management process that includes mitigation and adaptation, taking into account actual and avoided climate change damages, co-benefits, sustainability, equity and changes to risk.
“Choices about the scale and timing of greenhouse gas mitigation involve balancing the economic costs of more rapid emission reductions now against the corresponding medium term and long term risks of delay.”
Climate change will be one of the topics at FERMA’s biennial FERMA Forum, which has as its theme global responsibility and sustainability. The event will take place in Geneva from September 30 to October 3. According to Franck Baron, risk manager for a Swiss chemicals company and chairman of the 2007 Forum, “Part of the role of the risk manager is to take a longer term view of the exposures to the company and the problems to be solved, so that we consider whether the way we do things now is going to be sustainable long term. One of those issues is the way we use energy.”
Ms Dequae concluded, “The way we will deal with climate change at the global level will determine our capacity to manage globalization in an equitable and sustainable way.”
For more information about FERMA and the upcoming Forum 2007, go to its web site at: www.ferma.eu. The IPCC web site is www.ipcc.ch.