Mirjam BambergerChief Strategic Development Officer, AXA in Europe & Latin America
June 24, 2022
The key issue has become apparent with the latest climate assessment of the Intergovernmental Panel on Climate Change: A credible transition to a below 2 or even 1.5 degree world has become increasingly challenging.
At this point in time we are tracking towards a 3.2 degrees world above pre-industrial levels - and this is only upon the condition that governments implement their current mitigation policies.
There is a real risks for our climate to rise above 2ºC that could make life unbearable for millions of people. Already today nearly half of the world’s population live in contexts that are highly vulnerable to climate change. And we all have witnessed the increase in frequency and severity of natural disasters such as intense heatwaves, droughts and fires, cyclones, extratropical storms, torrential rains and river floods.
For the insurance sector the risk of climate change can (still) be repriced every year in a base scenario, so most of the risk remains with society. What becomes, however, an event that happens every year will no longer be insurable. The toll on society will be high.
The 2022 IPCC report is an eye opener. If you do not have time to read hundreds of report pages, here are the top findings of the assessment summarized for you:
The levels of societal awareness and support for climate have never been as pronounced. Yet, we are all aware that the “Net-Zero” commitments become increasingly challenging to achieve by 2050. There is insufficient rapid pace to decarbonizethe real economy. This will require actors to set more ambitious intermediate targets to a net-zero trajectory and create more credible transition plans. Such plans no longer consist of divestments only, but real economy engagement.
The IPCC concludes rather alarmingly that, despite increased civic and private engagement to combat the climate crisis, there is no conclusive evidence that this results in overall better mitigation outcomes. In fact, there is evidence that confidence in the effectiveness of public and private actors to combat climate change is gradually eroding.
So what to expect from our plant in the next 100 years if we do not take any action on Climate Change? Today's business as usual is making our planet unlivable:
The sense of urgency is high to bolster our actions around climate change. And to governments, the outlooks are rather uncomfortable, ironically, with or without underestimations under review.
To state the obvious: Prevention remains the key lever to increase society’s climate resilience and adaptation.
The IPCC has become an extremly valuable source to factualize climate risks. For non-experts, however, the assessment remains too dense in data and rather overwhelming.
To more valuable resources I can offer:
On a (personal) side note, the WEF decided to restrict some of the insights to a fee-liable access. This is unfortunate. It is this type of knowledge that should be shared and accessible to everyone. This is how we save our planet, and there are better ways to make money.
The content of this article reflects the opinions of the author concerned and not necessarily those of the AXA Group.