COVID-19 may have dominated the news in 2020, but for many people around the world, the ever-present climate crisis exacerbated that into an even bigger danger to their lives and livelihoods.
With the Australian bushfires, costing $5 billion; super-cyclonic storm Amphan devastating India, Sri Lanka, and Bangladesh, costing $13 billion; the Atlantic Hurricane season powering through the U.S. and Central America, costing $40 billion; floods overwhelming China, costing $32 billion; and unprecedented wildfires ravaging the U.S. West Coast, costing $20 billion; almost every part of the globe was impacted by climate-related disasters in 2020, with catastrophic results for millions of people.
Between 2017-2018, adaptation finance gained momentum, increasing 35 percent to an annual average of $30 billion from $22 billion in 2015-2016. This increase is indicative of the increasing importance of climate-resilient development and the urgency to build adaptive capacity to manage climate change vulnerabilities.
However, according to the Global Commission on Adaptation (GCA), adaptation finances continue to fall drastically short of the required global financing of $180 billion annually for 2020-2030. The GCA has estimated that investing $1.8 trillion into adaptation and resilience measures globally in five areas from 2020 to 2030 could generate $7.1 trillion in total net benefits.
The five areas they consider are:
- early warning systems;
- climate-resilient infrastructure;
- improved dryland agriculture;
- mangrove protection; and
- investments in making water resources more resilient.
It is critical that major corporations with global supply chains, impacts and footprints contribute to financing adaptation and resilience projects. Some organizations are beginning to invest in adaptation and resilience; however, the corporate sustainability projects intended to reduce greenhouse gas emissions or spur technological advances in renewable energy and the financing mechanisms available to fund these efforts are much further along.
While adaptation and resilience must be embedded into these sustainable projects, new innovative climate adaptation and resilience finance mechanisms from the corporate sector are needed now. Cities and other organizations like the international Climate Bonds Initiative have been exploring frameworks to guide green bond standards and resilience investments more broadly.
However, more creative, innovative, and collaborative climate adaptation and resilience finance mechanisms are needed to manage and address the current and future risks and opportunities communities face in a changing climate.