While we can’t attribute individual events to climate change, the Met Office has recognised climate change is likely to be a factor in the extreme weather that has hit much of the UK in recent months. The storms and floods are therefore a stark reminder of the risks that lie ahead – not just for communities, but also for businesses.
The costs of failing to act on climate change would be staggering, both in terms of lives affected and investments lost. The World Bank recently outlined how, globally, weather-related losses and damage have risen from an average of about $50 billion a year in the 1980s to close to $200 billion a year over the last decade, making climate-resilient and disaster-resilient development a critical challenge.
As climate change is likely to result in increased damage and costs due to more intense and more frequent extreme weather events, we need substantially to reduce greenhouse gas emissions to reduce the risks of a changing climate, and to build an economy resilient to the impacts that are, by now, inevitable.
Our economy is also facing future risks from depletion of resources. All economic activity is ultimately dependent on the natural world, yet we are using the earth’s resources far more quickly than they can be replenished.
There are encouraging signs that Wales is waking up to this agenda. Rather than burying their heads in the sand, government and businesses are taking steps to ensure that the Welsh economy is proofed for the 21st Century – one that is both resilient and prosperous. We now have the prospect of Welsh legislation that will provide forward-thinking investors with a business environment they’d struggle to find elsewhere.
Today the Welsh Government launches its ‘National Conversation’ on its Future Generations Bill. It is vital that the voice of business is heard as part of this conversation. Properly crafted and implemented, this legislation can help deliver a ‘One Planet Wales’ – a low carbon, resource-efficient country that uses its fair share of the earth’s resources, creating jobs and tackling poverty in a truly sustainable way.
The Bill should also provide businesses with greater certainty. By putting sustainable development at the heart of government and public services through legislation, business people should feel confident that Wales is serious about creating a resource-efficient, low carbon, 21st Century economy, and that the support and investment will be there to help them succeed.
A strong Future Generations Act should, for instance, have a positive impact on public procurement. This will mean that the billions spent each year by the Welsh NHS, local councils and other bodies are geared around both meeting the immediate needs of Wales’ citizens and driving bigger changes for the longer term. That would include creating jobs that have a future, in businesses that are resilient in the face of scarce natural resources – and the need to cut emissions so as to provide a safe climate for future generations.
It also means innovation – with Wales developing the goods and services that we and the rest of the world will need in this changing landscape. WWF’s ‘Green Game-Changers’ report showed that western companies should look to the green innovation in the east in order to keep up. Asian innovations are already sending ripples across the globe. China, for example, is bringing integrated electric vehicles, renewable energy and battery technologies to the west.
But business opportunities are opening up in Asia for western firms that can help tackle social and environmental challenges alongside the rapid economic growth across the continent. The increasing desire for on and off-grid renewable energy, car-sharing services, clean cooking stoves and other cleantech services present opportunities for western firms that can complement home-grown solutions.
There is also the opportunity, through the forthcoming Environment Bill, to embed Wales’ target of reducing greenhouse gas emissions into legislation. This would give a green light to businesses that are committed to sustainability to invest in Wales and would mean support for those businesses already working to reduce their emissions.
WWF recently secured the backing of over 100 organisations – from Ikea to the TUC – to support the UK’s 4th carbon budget. This shows the appetite on the part of businesses for governments to provide clarity and certainty for them to reduce their carbon emissions. Wales is well positioned to be at the forefront of this.
Of course, there is already a strong foundation upon which to build. There are already over 40,000 low carbon and environmental jobs in Wales – from the company in Swansea building houses from recycled plastic, to the wind turbine factory in Monmouthshire. There are also many examples of businesses in other sectors which are changing how they operate so they are more future-proof, such as by reducing their energy demand or shifting from fossil fuels to renewable energy sources.
The legislative opportunities that currently exist in Wales are rare. While the strong laws we need are not yet a done deal, I hope that in the next few years, Wales will be seen as the land of opportunity for those of us who want a 21st Century economy.