4 September 2024

Adaptation to climate change: challenges and opportunities for business

Environmental and energy issues are becoming cornerstones for entrepreneurs who are concerned about the planet’s future. Businesses are working to reduce emissions by developing green technologies and sustainable financing systems. New initiatives aimed at adapting to changing climate conditions are emerging. These steps not only help protect the environment, but also open up new horizons for economic growth and sustainable development. That was the conclusion reached at a session entitled Adaptation to Climate Change: Challenges and Opportunities for Business, which took place as part of the Eastern Economic Forum.

 

KEY CONCLUSIONS

 

Climate change is a key issue for all of humanity

“Regardless of where we live or which resource- or tourist-based economy we work in, climate change affects us all in one way or another. That’s the crucial aspect. And only when the last animal or fish disappears will we truly realize that we can’t eat money. That’s why it’s essential to address this today,” Sergey Machekhin, Deputy General Director for Project Engineering, Sustainable Development and International Cooperation, RusHydro.

“We need to find solutions that will help us tackle the challenges we face in the moment. There is an entire market for these solutions, called greentech. The global greentech market is currently worth around USD 4.5 trillion, and is growing by close to 30% annually. It is forecast to reach nearly USD 10 trillion by 2030,” Tatiana Zavyalova, Senior Vice President for ESG, Sberbank.

“There are not only risks for businesses, but also opportunities that can be leveraged and capitalized upon,” Sergey Zhuravlev, Vice President of Government Relations, Polyus.

 

Russia is addressing the need to adapt its economy in the face of climate change

“We offer products that at worst slow down climate change, and at best prevent it completely. That is because nuclear energy is the cleanest form of energy available to humanity today. Suffice to say, Russia’s current nuclear power plants prevent around 100 million tonnes of CO2 emissions into the atmosphere each year. This is comparable to the entire output of the country’s metallurgical industry. We are naturally proud of these results. That said, we need to think more about CO2,” Kirill Komarov, First Deputy General Director, Director of the Development and International Business Unit, ROSATOM State Atomic Energy Corporation.

“Norilsk Nickel is no less of a green brand than Sberbank, because our basket includes metals (platinum, palladium) which make a future green economy possible. This includes hydrogen power, electric vehicles, and charging infrastructure. We won’t be able to create a cleaner world as a whole without these metals,” Dmitry Pristanskov, State Secretary – Vice President, Norilsk Nickel.

 

PROBLEMS

Climate change has had a significant impact on the Russian and global economies

“According to data extrapolated from long-term observations by the Federal Service for Hydrometeorology and Environmental Monitoring, the average annual surface air temperature in Russian territory has been increasing by about 0.5 degrees every ten years since the mid-1970s. The temperature increase has accelerated by 0.04 degrees since 2019, which is 2.8 times faster than the global average. What’s more, in the Russian Arctic, the increase in average annual air temperature is 3.9 times the global average,” Marina Kim, Deputy of the State Duma of the Federal Assembly of the Russian Federation; TV presenter, journalist.

“The change in temperature – at least in Russia – has led to an increase in adverse climate events from 150 to 400–450 per year, all of which have specific negative economic consequences. <...> By 2030, losses [from these events – ed.] in Russia alone will amount to at least RUB 12 trillion – that’s a fairly significant figure. And things are no better elsewhere in the world,” Tatiana Zavyalova, Senior Vice President for ESG, Sberbank.

“Today, the world is indeed changing, and we are witnessing not only changes to the climate across the globe, but also shifts in how we respond to them. <...> We are having to change our operational models and corporate behaviour models, including within the ESG framework,” Sergey Machekhin, Deputy General Director for Project Engineering, Sustainable Development and International Cooperation, RusHydro.

 

An increasing strain on ecological equilibrium due to the rising global population

“The global population stood at around 6 billion at the turn of the century. Now it’s about 8 billion, and by 2050, it’s expected to reach around 10 billion. Urbanization is also growing – more than half the world’s population now live in cities, and by 2050, this figure will increase to about 70%,” Marina Slutskaya, Director of the Sustainable Development and International Cooperation Unit, DOM.RF.

“Today, unfortunately, the scientific potential of the last century is virtually exhausted. First of all, technology has changed drastically. Secondly, the global climate has indeed changed, and this is due to both human activities and natural changes,” Sergey Machekhin, Deputy General Director for Project Engineering, Sustainable Development and International Cooperation, RusHydro.

“When we talk about climate risks, we need to proceed from at least a 10-year horizon. <...> We need data, and right now we are basically missing standardized data on things concerning, say, risk factors which could be linked to specific territories. This data must be uniform,” Igor Korotetskiy, Head of the Group for the Provision of Services in the Field of Operational Risks and Sustainable Development, Kept.

 

SOLUTIONS

 

Ensuring Russia pursues its own sovereign path in addressing climate challenges while taking into account global trends

“The climate doctrine, both across the globe and in Russia (where it has already been adopted at the legislative level) is of course not about making money. But it’s important not to lose money either. <...> We should keep pace with global trends, but not lose sight of the fact that we are traversing our own sovereign path of development. This concerns the structure of the fuel and energy sector, the research and design complex, and the industrial cluster. <...> We do have our own sovereign path, and it is very important to understand that. Abandoning traditional methods of generation in our country – whether coal or mixed generation – is a path to nowhere. At the same time, it is crucial to understand which tools and mechanisms should help make various kinds of generation cleaner,” Sergey Machekhin, Deputy General Director for Project Engineering, Sustainable Development and International Cooperation, RusHydro.

“We already have an approved climate change policy and an updated corporate strategy concerning the environment and climate change. <...> Adapting to climate change is of course primarily about identifying and minimizing risks and having a capable monitoring system, particularly when it comes to industrial sites,” Dmitry Pristanskov, State Secretary – Vice President, Norilsk Nickel.

“A decision was made by President Vladimir Putin and the government that the share of nuclear energy in our country, which currently stands at 20%, should increase to 25% by 2045. We are set to build several dozen new nuclear reactors… For the first time, we will look East of the Ural Mountains, and we will begin constructing nuclear reactors in the Far East as well, since economic growth is contingent on more energy. Our main contribution to this area is nuclear power itself,” Kirill Komarov, First Deputy General Director, Director of the Development and International Business Unit, ROSATOM State Atomic Energy Corporation.

 

Improving regulatory mechanisms and ensuring that efforts to manage climate change remain free from political influence

“As we see it, there is a lack of certain regulatory and incentive mechanisms – with an emphasis on the second part – aimed at ensuring that the corporate sector begins to systematically address climate risk management and develop adaptation plans accordingly. Probably the most appropriate, straightforward, and market-driven mechanism would be incorporating climate risks into the banking system. The Bank of Russia is already moving in this direction. The second mechanism consists of making the corporate sector report on climate risks. In this respect, I believe that aligning with international standards is the right course of action,” Igor Korotetskiy, Head of the Group for the Provision of Services in the Field of Operational Risks and Sustainable Development, Kept.

Countries in the Western economic alliance – let’s call it that – invariably try to politicize this issue. <...> Aspects as vital as climate change management should be free from political influence. That is the first point. And secondly, they should serve as an economic instrument, or at least an economic bridge to develop partnerships,” Sergey Machekhin, Deputy General Director for Project Engineering, Sustainable Development and International Cooperation, RusHydro.

“This endeavour is an objective necessity for us – and the numbers are there to prove it. Last year alone, we invested around RUB 339 billion in projects related to the United Nations’ sustainable development goals. That’s a colossal sum.” Dmitry Pristanskov, State Secretary – Vice President, Norilsk Nickel.

 

* This is a translation of material that was originally generated in Russian using artificial intelligence.

 

For more information, visit the Roscongress Foundation’s Information and Analytical System at roscongress.org/en

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