Consumer products, Manufacturing, Printing and publishing, Canada Overview of climate-related risks and their potential impacts
As part of the company’s sustainability disclosures, EEM was asked to review how climate-related risks were being identified and managed, and to suggest improvements on how they were being communicated in the company’s corporate reports.
Approach and solution
EEM adheres to Mark Carney’s definition of climate-related risk to mean not just the physical risks related to climate change, such as flooding or storms bringing work interruptions, but also the transition risks related to adjusting to a low carbon economy. This includes changes in policy and regulation that could prompt a reassessment of the value of large range of assets as costs and opportunities become apparent.
EEM proceeded with a review of what those risks and opportunities were for the company and highlighted the importance of looking up and down the value chain to adequately capture the risk.
EEM then provided the company with recent information and trends for the company to be in a position to judge whether the risks were now to be considered material in corporate reporting and/or of sufficient size to be managed with other enterprise risks. EEM presented recent information on investor interest in climate-related risk and the new mandatory reporting applicable to certain types of investments in different jurisdictions.
Using the information from the review, EEM suggested improvements to the company’s reporting to the CDP (formerly Carbon Disclosure Project). Of interest, EEM had completed the company’s first ever CDP report in 2007 and has had on-going involvement in the quantification of the company’s greenhouse gas emissions.
The climate-related risk review was also used to improve management of the company’s own greenhouse gas emissions as well as a wider range of environmental issues, risks and opportunities that may have a climate impact at another point in the value chain.