Since the Rio Summit three decades ago, climate change has progressed from a mere challenge to an urgent crisis.
The rate of change has surpassed original projections, and it is increasingly recognized as an issue of economic development rather than just an environmental one. We must recognize that addressing climate dangers necessitates nothing less than a major economic revolution, akin to India's 1990s economic liberalization. This shift, however, will produce both winners and losers, and firms cannot afford to remain inactivity.
In 2023, temperatures are breaking records and there are more and more deadly climate-related events happening around the world. Governments, insurers, and businesses are struggling to keep up with the pace and unpredictability of these disasters, which range from floods in Libya, India, Greece, and China to droughts in Brazil and wildfires in Canada and Hawaii. Climate change is no longer something that happens "out there"; it is a real worry for India Inc. since it affects rainfall, agriculture, food security, and economic output. It also has an effect on rural income, the fluctuating demand for fast-moving consumer items, and labor productivity in industries like construction.
The financial consequences of climate change are significant, with billions of dollars at stake due to uninsurable non-linear climatic hazards. Natural disasters alone produced $120 billion in losses in the first half of 2023, of which only $50 billion was covered, resulting in a significant "protection gap." This strains the government's finances and takes money away from projects that will pay off.
Businesses must become more climate-focused, climate-ready, and climate-friendly in order to manage this shifting landscape. This includes creating clear and credible emission-reduction plans, investing in climate-risk assessments, and aligning products and services with climate-tech potential. Climate change adaptation is not only crucial for long-term sustainability, but it also gives economic potential for enterprises. Finally, in a world where everyone is affected by climate change, business models must adjust to assure future readiness and success.
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Technology is a useful servant, but a dangerous master, it was rightly said. Electronic devices have grown into an inevitable part of our daily lives.
