Climate Action

Wild weather: How can businesses manage and mitigate the risks?

A search and rescue team searches the remains of a home burned by the Palisades Fire, in the Pacific Palisades neighborhood in Los Angeles, California, U.S. January 14, 2025. REUTERS/David Ryder

Extreme weather events are intensifying worldwide, creating ever-greater risks. Image: REUTERS/David Ryder

Elizabeth Mills
Writer, Forum Stories
This article is part of: World Economic Forum Annual Meeting
  • Extreme weather events are becoming more intense and frequent, increasingly affecting people, their governments and businesses worldwide.
  • There is a push to link economies and business operations with climate information in a relevant, meaningful way, in an effort to improve tracking and resilience.
  • Business must play a role, and greater collaboration with government and scientists will help create systems that save lives as well as offer business opportunities.

If it feels like events triggered by extreme weather increasingly crowd the news headlines, it’s probably because their number has increased five-fold in the past 50 years. Heatwaves, cold waves, flooding, tropical cyclones, wildfires; we’re getting all too used to images of devastation and the accompanying reports of the escalating monetary and human costs. Action is required, but just what is possible in the face of such a mammoth adversary as wild weather?

The effects of extreme weather provided in economic and society-related lists.
The direct and indirect consequences of climate-related hazards on people and economies.

The weather’s human signature

The climate is naturally variable (as evidenced in the El Niño and La Niña phenomenon), but scientific analysis has explicitly linked the anthropogenic cause behind extreme events such as flooding or wildfires. Climate change has resulted in changes in the duration, frequency, intensity and timing of weather extremes.

According to Johan Rockström, Director of Potsdam Institute for Climate Impact Research (PIK), speaking at the Annual Meeting during the session, What’s Going on with the Weather?, there are no extreme events that fail to have a human signature. For him, it’s impossible to talk about natural extreme events. Instead, the question should be to what extent have humans influenced these events?

Given that last year was the first during which we touched the 1.5°C threshold, and that according to Rockström in 5-10 years we will have exceeded it, he mused that we may in future years look back to 2024 – officially the warmest year in 100,000 years – as relatively harmonious because the science suggests that the situation will only deteriorate before it improves.

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What steps can we take?

Facing this unsavoury prospect, the immediate strategy needs to focus on adapting as swiftly as possible to try to counter the effects of extreme weather-related, while at the same time implementing wide-ranging mitigation strategies.

Celeste Saulo, Secretary-General, World Meteorological Organization (WMO), Switzerland; Jane Nelson, Founding Director, Corporate Responsibility Initiative and Senior Research Fellow, Harvard Kennedy School of Government, USA; Johan Rockström, Director, Potsdam Institute for Climate Impact Research (PIK), Germany; speaking in What's Going on with the Weather? session at the World Economic Forum Annual Meeting 2025 in Davos-Klosters, Switzerland, 22/1/2025, 15:00 – 15:30 at Kurpark Village - Briefing Centre. Issue Briefing. Copyright: World Economic Forum / Faruk Pinjo
Celeste Saulo, Secretary-General, World Meteorological Organization (WMO), advocating for the greater deployment of early warning systems. Image: World Economic Forum

Celeste Saulo, the World Meteorological Organization’s Secretary-General, speaking alongside Rockström, called for the increasing development and deployment of early warning systems (EWS) as a key element in saving lives.

Using EWS to improve resilience

EWS are complex systems involving sensors, analytical tools, communication chains and plans, designed to support swift and efficient responses to weather events.

Policy should be conducive to these developments. Saulo revealed that although extreme heat kills more than 500,000 people a year, and by 2035, it is estimated that the annual productivity loss from heat alone will be $2.4trillion, just 26 countries globally use heat as a factor in their decision-making.

Policy-makers should also invite business to work alongside them on this issue and in the development of EWS. In doing so, knowledge about weather-related hazards improves, helping business make more informed decisions. Business also brings innovation, different perspectives and investment, all of which are valuable when developing systems aimed at better protecting people and economies worldwide.

Saulo revealed research findings suggesting that the return on investment into EWS makes for a strong business case, with analysis suggesting that for every dollar invested in the most developed countries, businesses would make a return of $9, which rises to $19 in parts of Africa and Asia.

But businesses have other roles to play in terms of these systems. Beyond investing in and producing EWS, they too are users. Opportunities are growing for businesses to explore the use of EWS to enhance the robustness of their operations and supply chains against extreme weather events. In turn, greater collaboration can potentially lead to advances in the technology, as well as in areas like data availability and sharing.

The shift to mitigation

Rockström regards business as having both a great opportunity but also a high level of responsibility to map risks throughout their value chains, and in turn, make this information public. He argued that given the threat that extreme events have to the value of companies and their profitability, they have a duty to shareholders to be transparent, suggesting that this information can in turn, help inform regulation and policy-making.

Celeste Saulo, Secretary-General, World Meteorological Organization (WMO), Switzerland; Jane Nelson, Founding Director, Corporate Responsibility Initiative and Senior Research Fellow, Harvard Kennedy School of Government, USA; Johan Rockström, Director, Potsdam Institute for Climate Impact Research (PIK), Germany; speaking in What's Going on with the Weather? session at the World Economic Forum Annual Meeting 2025 in Davos-Klosters, Switzerland, 22/1/2025, 15:00 – 15:30 at Kurpark Village - Briefing Centre. Issue Briefing. Copyright: World Economic Forum / Faruk Pinjo
Johan Rockström, Director of Potsdam Institute for Climate Impact Research, calling for robust mitigation plans. Image: World Economic Forum

Ultimately, however, Rockström holds that we should no longer separate adaptation and mitigation strategies. He defines resilience as zero carbon adaptive capacity, and for him the focus should be entirely on resilience building.

Science shows that extreme events don’t operate in isolation from one another. Extreme weather – the cause of which is ultimately anthropogenic – is a precursor to extreme events like wildfires and flooding. We have the capacity and tools to address the causes of extreme weather. What’s needed is to speed up mitigation action while also building more adaptative capacity. In doing so, we have the greatest opportunity of all – to change the headlines.

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The views expressed in this article are those of the author alone and not the World Economic Forum.

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