Business & Industry

Businesses in Scotland are already being impacted by weather that is indicative of predicted climate change effects, including extreme weather events such as increased intensity of rainfall leading to flooding.

The associated costs of these impacts are already high. We as businesses must be better prepared for an increased number and range of such events if we are to survive and thrive, and be in a position to manage the risks that a changing climate presents. Equally, it is vital that we are ready to take advantage of the new opportunities that climate change will bring. So by understanding more about the nature of how Scotland’s climate is changing and taking account of this in our business planning, these opportunities can be transformed into economic realities that can promote resilience and underpin Scotland’s low carbon economic growth.

These changes could be an issue for your business and affect your bottom line e.g. extreme weather conditions may cause significant disruption and associated costs. Planning ahead is often more likely to lead to cost-effective adaptation than responding to changes as they happen. This allows for integration into other business functions such as risk management and business continuity planning. Climate change will also bring commercial opportunities and businesses need to be ready to take advantage of these.

Key Impacts

Some industrial and agricultural processes are climate sensitive and some equipment has operating requirements that climate change could jeopardise.
Flooding, subsidence, excessive temperatures or stormy weather can cause damage to stock or equipment or loss of business continuity, therefore directly affecting the bottom line.
Climate impacts on people, as customers for goods and services and as members of a workforce, for whom working conditions, both inside and out, could change beyond acceptable thresholds.
Nearly all businesses make use of premises and transport systems, both of which are vulnerable to weather-related events like floods, storms, and subsidence.
Infrastructure for transport and utilities is particularly vulnerable, and therefore puts at risk supply companies and those businesses that use their systems.
There has been a steady rise in the costs of business claims for weather damage. In 2007, 28% of businesses reported disruption as a result of extreme weather (Chartered Management Industry Survey, 2008).
Many UK-based companies rely on manufacturing operations in East and South East Asia, where impacts such as an increase in the frequency of tropical storms and water scarcity are expected.

Key Opportunities

Climate impacts on agriculture in other countries could result in market opportunities for UK food production.
Some markets will expand and there will be new market opportunities, such as outdoor leisure, summer food, drinks and clothes and flood defence technologies.
Some industrial and agricultural processes and activities could become easier or more economically viable and winter heating costs will be reduced.

What’s Happening?

Adaptation Scotland

In June 2010, Adaptation Scotland published ‘Adapting to Climate Change: A Guide for Businesses in Scotland’. This guidance gives an overview of what risks and opportunities climate change may pose for Scottish businesses; explains how to build the adaptive capacity to deal with these risks and provides a signpost to the various existing tools and resources that are available. Adaptation Scotland intends to work with various sectors within business and industry to develop sector specific guidance and training modules which will help businesses to identify risks and opportunities from climate change and develop adaptation strategies to deal with these. Adaptation Scotland has a Private Sector Officer, whose role is to liaise and advise the private sector on the issue of climate change adaptation. Please email Lorraine FitzGerald (Lorraine@sniffer.org.uk for further details). Adaptation Scotland is also working with a range of business-facing organisations to integrate climate change adaptation more fully into everyday business operations and policies.

Scotland’s Climate Change Adaptation Framework Business and Industry Sector Action Plan

A Business and Industry sector action plan is included within Scotland’s Climate Change Adaptation Framework. The plan provides informaiton about the broad range of work that will be undertaken over the coming years to strengthen resilience of the sector to the impacts of climate change.

Scottish Government has worked with a wide range of organisations including Scottish Enterprise, Highlands and Islands Enterprise, Scottish Tourism Forum and Visit Scotland to develop the plan which will be regularly updated.

Adaptation Options

Adaptation options in business and industry are as wide ranging as the various types of businesses in this sector. However, addressing adaptation within a business is best approached from a systematic point of view. In ‘Adapting to Climate Change: A Guide for Businesses in Scotland’, a five step methodology is outlined that will help businesses assess their vulnerability to current weather and future climate change, identify options to address key climate risk and opportunities and help businesses to develop a climate change adaptation strategy. This process is based on UKCIP’s Adaptation Wizard.