There are four categories of risks identified by the Task Force on Climate-Related Financial Disclosures (TCFD) and that we assess for our clients:
Chronic Physical Risks: These risks compound over time and introduce long-term stress to physical assets. Some examples include sea level rise, water scarcity, and long term temperature shifts.
Acute Physical Risks: These risks are one-time events or “shocks” that have an immediate impact and are difficult to predict. Examples include wildfires, extreme rainstorms, heat waves, and cold snaps.
Regulatory Transition Risks: This includes government regulations limiting greenhouse gas emissions, such as net-zero targets, cap and trade regimes, and carbon pricing, and can also include litigation risk.
Market Transition Risks: These risks include investor and consumer pressure to reduce emissions and produce climate-friendly products.
We can help you document your risks, and identify mitigation pathways to build resiliency. Identified risks are presented in dynamic heat maps and matrices to support prioritization of sites or regions with greater exposure. For physical risks, mitigation pathways may include facility climate resiliency toolkits, documenting actions that each facility can take to reduce their exposure to risks. For transition risks, you may consider completing an enterprise-wide Low Carbon Transition Plan.
