COP27: ‘Climate change is a risk management problem on a global scale’

A global temperature increase of 1.5°C could cause irreversible changes to the Earth’s climate, triggering multiple tipping points like Greenland ice sheet collapse or Amazon dieback, which could interact and cascade like dominoes.

That’s according to a report by the Institute and Faculty of Actuaries (IFoA) written in collaboration with The Climate Crisis Advisory Group (CCAG).

It warns that even under the current targets set out in the Glasgow Pact, global society is heading towards a ‘ruin scenario’. 

Sandy Trust, former chair of the IFoA Sustainability Board, commented: “Climate change is a risk-management problem on a global scale. Policymakers must act now to accelerate climate action to avoid catastrophic impacts on society.

”We have underestimated the pace of climate change, as well as the level of risk associated with 1.5 degrees of warming.

”We need to prepare for further climate impacts, as well as reducing emissions rapidly. However, we have the solutions required and it is within our collective capabilities to steer our future back onto a safe course.”

Sir David King, Chair of the Climate Crisis Advisory Group, commented: “Human caused climate change has run down the clock, and we are fast running out of time to keep the critical 1.5 degrees hopes alive.

“But whilst this may seem daunting, we have the science at hand to reduce emissions and stabilise the climate.

”What this report clearly shows is that even at 1.5 degrees serious mitigation and risk management will be required alongside a strategy of Reduce, Remove and Repair to deliver a manageable future for humanity.”

Catastrophic tipping points

The report calls for policymakers and stakeholders to take a risk management approach to identify, measure and mitigate the effects of further temperature rises.

This will support the broader effort to build resilience and climate adaptation into national and international systems as extreme events become more frequent.

The report sets out the key findings: 

• Climate change is a risk management problem - Catastrophic outcomes from climate change are now inevitable, so it is crucial that policy-makers have a degree of climate and risk literacy as they plan for the uncertain future.
   
• Carbon budgets should be treated with caution when planning for long term sustainable investment - Large margins for error and ‘no surprises’ assumptions are a source of undue confidence in carbon budgets, which have only a 50% chance or less of hitting the 1.5°C target.
  
  
• Tipping points mean there is even more uncertainty – We need to plan for low-likelihood, high-severity risks. Incorporating uncertainty would lead to a downward revision in available carbon budgets, an acceleration towards decarbonisation and a move to better understand and invest in options for adaptation.
   
• Adaptation is key to planning for further warming and climate impacts - Climate resilient development strategies will be key to ensuring adaptation is fair and inclusive of all citizens, local and indigenous communities and groups who are most vulnerable to climate change.

There is hope, but no time to lose

The report serves as a timely reminder for CCAG’s RRR strategy:

• Reduce emissions urgently, deeply and rapidly, while ensuring an orderly, just transition;
• Remove CO₂ from the atmosphere in vast quantities;
• Repair broken parts of the climate system, starting with the Arctic, to try and reverse local changes and stop the cascade effects of those changes through global climate systems.

The report is also calling for action to be accelerated by educating the public to be more carbon and climate literate. By embracing the economic benefits of steering humanity back to a safe climate trajectory, stakeholders across communities and nations will be better poised to benefit from a green transition that works for all. 

Don’t miss all the latest news from COP27 at the World@Risk Climate Change & ESG Forum.