A survey by global risk management and insurance broker Gallagher has found that almost half (48%) of all UK businesses have been impacted by climate change.
The study, which surveyed more than 1,500 UK business decision-makers, revealed that 52% of those affected reported that their ability to do business has been impacted by extreme weather events.
Climate change is already a significant challenge for British businesses, with nearly three-quarters of business leaders concerned about its impact over the next decade.
The survey found that the most common effect of climate change on British businesses is disruption from extreme weather events, including flooding, storms, and heatwaves, with 52% of businesses reporting this impact. Other effects include climate change-related increased operating costs (47%), supply chain issues (39%), and physical damage (35%).
The sectors facing the most significant pressures from climate change include hospitality and tourism (57%), banking and finance (53%), and retailers/FMCG (fast-moving consumer goods) firms (50%), posing a significant threat to the UK’s service-based economy.
Despite the widespread concern among businesses, more than half of all business leaders (53%) have not taken steps to mitigate against the risks of climate change, with a third failing to include climate change on their risk registers. The study shows that the consensus (51%) is that it is the government’s responsibility to ensure businesses are adapted to meet the challenge, with only 16% thinking the onus lies with businesses.
Neil Hodgson, managing director of risk management at Gallagher, said: “Climate change clearly poses a serious threat to British businesses – and the damage is already being done. The country is committed to reducing our emissions and reaching net zero by 2050 but, with half of businesses reporting impacts, it seems we are already on the backfoot.”
Of those businesses planning to protect themselves against climate change, the most common strategies are committing to reducing carbon emissions (44%), reviewing their insurance policies (32%), setting a net-zero target (32%), and investing in environmentally friendly technologies (32%). The most popular methods already employed by business decision-makers are reducing paper use (63%), using automatic lighting (60%), sourcing renewable energy (58%), and deploying LED lighting (58%).
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