Climate change opportunities could outweigh risks for UK businesses
Defra has set out the risks and opportunities businesses face as climate change and extreme weather becomes increasingly prominent.
According to Defra's National climate change adaptation programme report, while the impacts of a changing climate will increase the risk of damage to UK businesses, it will also offer vast financial opportunities.
Defra points to figures revealing that the impacts of climate change led to £170m of losses in 2011, while the total financial uninsured costs of the 2007 floods were estimated to be £4bn.
In addition, the heat wave of 2003 was estimated to have cost the economy £500m and according to Defra's Climate Change Risk Assessment, published last year, the combined annual average of domestic and commercial flood insurance claims could increase to £1bn by the 2080s.
However, the report notes that if businesses can manage these risks with minimal disruption and revenue loss, they will be better able to maintain a competitive position.
It states that the UK is already leading the way in the global market for adaptation goods and services - a sector which is valued internationally at £66bn.
According to the Confederation of British Industry (CBI), meeting the challenges of climate change is not just about addressing risk.
It is also about cultivating opportunity and it makes sense for individual businesses to start to incorporate changes in the climate into their own planning. The CBI claims that for example, increasing the flood resilience of buildings, infrastructure and homes will reduce the immediate costs of insuring vulnerable assets at a premium.
The CBI also notes that establishing leadership in the development of new adaptation technologies and expertise will carve out new export opportunities for UK businesses in a growing international market.