The chairman of Swiss Re America today urged the nation's municipal officials to consider creating the post of chief risk officer to work with the private sector on handling climate change and other risks.
Roger Ferguson made his comments in a talk at the Large Cities Climate Summit gathering in New York, attended by mayors and business leaders.
Mr. Ferguson said Swiss Re's interest in the climate change issue began almost 20 years ago, and the company believes "unequivocally that climate change presents an increasing risk to the world economy and to society at large."
A prudent risk management approach, he said, "requires us to take action today to mitigate and adapt to global warming so that we do not face catastrophic outcomes in the future."
Creating a chief risk officer (CRO) post, he said, could be an important step in enabling a public-private partnership to assess emerging risks, evaluate risk based on scientific knowledge, communicate the risk to officials and the public, steer mitigation efforts towards the biggest risks, and manage a pool of mega-risks "that cannot be carried by the insurance community alone."
Mr. Ferguson said that by "being directly plugged into private sector risk expertise, a deeper and wider basis will be formed, upon which policy decisions can be taken and the general public can be informed about key risks."
A CRO contact point to channel dialogue could significantly improve the resource allocation necessary "to ensure that major risks are identified and assessed, and mitigation measures are agreed upon," he added.
Mr. Ferguson said that climate change is not prone to simple solutions, but "requires a holistic approach and the combined efforts of the global community to both mitigate and adapt" to its effects.
He noted that while the insurance industry is able to manage many of the risks associated with this challenge, other areas are best approached with joint efforts and public-private partnerships.
Mr. Ferguson concluded by saying that there were many areas business could explore with the public sector "to help manage the risk of climate change and other challenges." He added, "Who knows, perhaps one day it will lead to the first cat bond of cities!"
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