As climate change shifts agricultural patterns and alters coastlines, people globally must adapt. But within the need for adaptation lie business opportunities, a new report says.
The report, released today by Oxfam America, highlights several areas of business that can benefit by addressing the adaptation challenges that climate change will bring.
For example, companies that make drip irrigation systems may benefit as drought increases in certain areas where agriculture depends largely on rainfall, said Jonathan Jacoby, senior policy adviser at Oxfam America. Companies specializing in disaster preparedness may also find their communication technologies in greater demand, as climate change increases the frequency and intensity of storms.
Heather McGray, an expert in climate change adaptation at the World Resources Institute, said that on the issue of climate change, businesses have so far focused primarily on mitigation -- for example, developing technologies in clean energy and energy efficiency -- rather than adaptation. The message that climate change adaptation poses business opportunities is "pretty new," she said.
"Until recently, I think everyone thought adaptation was still pretty far in the future," McGray said. "But the climate science is showing us that the climate is changing pretty quickly."
Seeing the opportunities as well as risks
McGray said that the best way to address climate change is still mitigation -- but adaptation will also be necessary.
"If we don't have some very substantial mitigation soon, we're going to have a lot, a lot, a lot of adapting to do," she said. "If we do have some mitigation moving soon, we will still have a fair amount of adapting to do."
That's where business can capitalize on the adaptation opportunities, she said.
"There are people who are scared that our economies are gonna be run over by climate change the way that you could just get run over by a tractor-trailer," she said. "But that doesn't need to be the case, if we're sufficiently proactive, and if we're able to sufficiently think through how to tackle climate change in the most cost-effective way."
But McGray added that even as some companies may benefit, many others will suffer. Agricultural shifts from climate change will affect not only food, but also products like cotton and coffee, which are the supply bases for some major companies, Jacoby said.
At a breakfast today, representatives from Starbucks, Nike, Levi Strauss & Co, and eBay will talk about the risks climate change poses to their companies. Spokespeople from other companies -- the insurance company Swiss Re, the investment company Calvert Investments, and the consulting firm Industrial Economics -- will talk about the business opportunities in adaptation.
The business case for adaptation policy
Jacoby said the report is aimed at businesspeople as well as policymakers.
A main goal of the report, he said, is to rally support for more government funding to address international climate change adaptation.
"I think the business and economic angle on climate change has been the dominant one on this debate," he said. "If you look at the way that the debate over Waxman-Markey played out, the whole discussion was around jobs, energy prices and other economic concerns. And the major voices that [helped push] through the bill were some leading companies that were supportive of the legislation."
The climate legislation that passed the House in June, sponsored by Reps. Henry Waxman (D-Calif.) and Edward Markey (D-Mass.), allocated 1 percent of emissions allowances to international climate adaptation. A coalition of businesses, along with advocacy groups like Oxfam America, has said significantly more funding is needed and has called for the number to be raised to 3 percent, Jacoby said.
Jacoby envisions such money spurring the early development of adaptation-focused industries.
"The fact that the whole debate was couched in terms of economics in the House gives us the sense that the Senate will really want to [think] about how adaptation and business intersect," he said.
The report does not provide numbers for how large the adaptation industry could be or how many jobs could come out of it. Jacoby said he hopes the report will be a starting point for other organizations, like think tanks, to delve into the topic in more detail.