Walker Institute joins forces with Deloitte to advise on the impacts of climate change on business
Release Date 26 September 2007
In response to the increasing number of companies looking to understand the impact of weather on their business, the University of Reading's Walker Institute for Climate System Research and Deloitte, the business advisory firm today (September 26)announced a joint initiative to provide scientific research and analysis into the implication of local and regional changes in climate and weather extremes on business.
The devastating floods in the UK during 2007 show just how vulnerable property and infra-structure are to extremes in the weather. If such extremes become more frequent – as predictions of climate change suggest – the impact on business could be immense, particularly in areas like insurance, mortgage lending, commodities and retail.
Professor Nigel Arnell, Director of the Walker Institute, said: "This is a very exciting partnership giving us the opportunity to use our expertise in climate extremes and hazardous weather, as well as our climate modeling capability, to really benefit business. There is no doubt that in the next few years the enhancement in our models will lead to improved climate change projections, something of significant value to business.
"The impact of climate change on property prices and the knock-on effect to mortgage lenders is a key area of focus. The Association of British Insurers is warning of dramatic increases in UK insurance costs which could render some properties effectively uninsurable. This is likely to affect house prices, with values falling in high risk areas and rising where risk is lower.
"It is conceivable that we will see these kinds of changes in the next 20 years. Mortgage lenders will need to consider climate change as part of their wider risk portfolio."
Dr Lis Gibson, the partner leading the climate change impact services at Deloitte, said: "We are delighted to have the opportunity to work with leading academics to bring the best advice to our clients in a fast moving and critical area.
"There is increasing demand from our clients across a range of sectors for better information and analysis of what sustained and variable climate change could mean to their business in the short, medium and long term.
"For businesses, like insurers, banks, retailers and the travel industry, to be able to assess the possible risks, they need much more detailed advice about local and regional changes in climate and weather extremes, not just for 2100, but for 2010 or 2015. Anticipating this trend we believe that in five years time it will be the norm for Chief Risk Officers to have contingency plans based around the impact of climate on their business as the interdependencies of climate risk shocks and financial markets become better understood."
The Walker Institute is leading research to develop more detailed climate models and they are already showing improvements in simulating weather systems like European storms and hurricanes, which bring some of the most damaging impacts.
Notes to editors:
The Walker Institute/Deloitte partnership will be launched in London this evening, Wednesday September 26. For more details please contact Ali Agmen-Smith on +44 (0)20 7303 0514 or email firstname.lastname@example.org.
Lis Gibson from Deloitte is available for interview. To arrange an interview, please call Ali Agmen-Smith on +44 (0)20 7303 0514 or email email@example.com
Prof Nigel Arnell the Director of the Walker Institute is available for interview. Please contact the Walker Institute communications manager Kathy Maskell on +44 (0)118 378 7380.
The Walker Institute for Climate System Research is a leading UK climate research centre based at the University of Reading. Its research is focused on understanding climate, in order to deliver better knowledge of future climate and its impacts for the benefit of society. See the Walker Institute website for more information.
In this press release references to Deloitte are references to Deloitte & Touche LLP which is among the country's leading professional services firms, providing audit, tax, consulting and corporate finance services. Deloitte & Touche LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu ('DTT'), a Swiss Verein whose member firms are separate and independent legal entities. Neither DTT nor any of its member firms has any liability for each other's omissions. Services are provided by member firms or their subsidiaries and not by DTT. Deloitte & Touche LLP is authorised and regulated by the Financial Services Authority.