NU Online News Service, July 13, 8:44 a.m.EDT

Reinsurers say companies worldwide have suffered intensifyingweather-related losses in the past three years, but less than athird of them are actively responding to the risk—increasing thelikelihood those companies will be unprepared to deal with theeconomic impact of more frequent and severe weather events.

“If we're not ready, we're in trouble,” says James E. Rogers,CEO of Duke Energy, relaying concerns that companies neglecting toincorporate changing environmental threats into their enterpriserisk management (ERM) programs could end folding under the pressureof a volatile catastrophe climate.

According to Swiss Re, many businesses do not feel sufficientlyinformed to take action on climate change, so a group ofcross-industry sector companies, including Swiss Re, Starbucks,Levi Strauss and Co., Calvert Investments, Earth Networks andEntergy, have created the Partnership for Resilience andEnvironmental Preparedness (PREP) program, headed by Oxfam Americaas secretariat.

PREP, a one-year pilot program addressing the potential impactsof climate change on businesses, their supply chains and theirsurrounding communities, has developed Business ADAPT, a five-stepprogram to help the business community identify bottom-line threatsand emerging climate-related market opportunities.

“Worldwide, as severe weather events increase in frequencyand intensity, businesses must incorporate weather-relatedcontingency plans throughout their value chains for improvedresponse to severe events while ensuring business continuity, assetprotection, and creating community and eco-system resiliency,”states Earth Networks President and Chief Executive Officer BobMarshall.

“The Business ADAPT tool is the first of its kind to helpcompanies across sectors as they begin to take action to addressthe impacts of climate change on their businesses,” says AmyLeonard, senior vice president of product Development, Levi Strauss& Co in a press release. “This tool helps companies like oursconsider solutions that build resilience in addition to reducingharmful greenhouse-gas emissions.”

The Business ADAPT steps include:

Analyze the resilience of your business in the face ofclimate-related impacts.

Mobilize an internal-strategy team to address climateresilience.

Assess the risks of climate change, but also assessopportunities to build climate resilience or invest in emergingopportunities along business value chains.

Prioritize these actions to build climate resilience into thevalue chain.

Take the strategy from paper to board meeting, and evaluate andmonitor climate change ERM efforts and accomplishments overtime.

The strategy is meant to help businesses cope with future eventson par with the 2010 heat wave in Russia that triggered wildfirescosting approximately $15 billion, and the 2011 Texas drought thatdrained the U.S. agricultural sector of $7.6 billion and cutearnings for clothing manufacturers.

“Extreme weather puts the reliability of not only ourdistribution system at risk, but also our power generation andtransmission systems,” says J. Wayne Leonard, chairman and CEO ofEntergy Corporation. “Similarly, our customers and communities areill prepared to respond to hazards of a magnitude and frequencythat we have never seen before. We have to do a better job ofworking together to understand, prepare, manage and respond tothese risks, and ultimately severe events.”