Lessons learnt from multisectoral climate risk assessments

This is part one of a four-part series exploring climate risk, resilience and adaptation. 

Investment into understanding how and when climate change will affect our way of life is evolving, and there is a growing understanding that assessing the risks associated with climate change and taking actions to adapt is critical for progress.

There are multiple factors that need to be considered when implementing a climate risk assessment and adaptation plan. Often there are detailed actions required, and assessments and planning are undertaken at localised levels (e.g., by local governments), by specific sectors, or for individual or thematic concerns. These are important and valuable, but it is also important that risks are understood at a regional, state, or national level.

Assessments at a regional, state, or national level require a multisectoral approach across multiple domains (built, economic, social, and environment) that can help to determine where and when investment is required, where new policies or legislation may be needed, and where other levers appropriate to the level of assessment can be enacted. Multisectoral climate risk assessments and adaptation plans also support investment in new data, in capacity and capability uplift and – critically – in galvanising stakeholders to take required action. 

Importantly, the risk assessment and adaptation process should also focus on opportunities. Many opportunities will emerge as we collectively put downward pressures on emissions, and upward support for adaptation. Identifying these opportunities at all levels is essential.  

Our work focusses on providing a bridge between understanding the risks and opportunities and the foundation for adaptation planning and action. Facilitating this process is key.  

The team at Deloitte has developed and implemented a number of national and state climate change risk assessment methodological insights and approaches. Our approaches draw on our collective experience advising governments on climate transition risks, the risks of physical impacts of climate change, vulnerability and sensitivity to a changing climate, and working internationally on climate risk assessments in a range of jurisdictions. In sharing our insights, a key question to ask is:

What are multisectoral risk assessments at the state and national level trying to achieve?

The short answers are that often they want

1. the most up-to-date picture of climate risks and opportunities, for physical and transition risks;
2. adaptation priorities to inform immediate adaptation planning in the shorter-and medium term; 
3. creating a sense of community and of purpose, as well as remaining cognisant of trade-offs.

Below we provide brief insights into some of the lessons we have learned through these processes. 

Leadership is essential 

National and state-wide multisectoral climate change risk assessments demonstrate leadership at high levels of government and in society. This helps to engage stakeholders from communities, government, and industry to increase their awareness of the challenge, as well as galvanising them to action. This leadership extends beyond borders and supports discussion between states and territories and, in Australia’s case, engagement with the Asia-Pacific nations, many of which are highly susceptible to climate change. 

Interdependencies can significantly alter the nature and magnitude of risk. A climate change assessment that does not address interconnections could lead to the miscalculation of risks, or affect the prioritisation of adaptation activities.  National or state-wide assessments can be particularly challenging and complex. It is essential when considering these assessments that the level of detail is fit for the purpose of the decisions that can be taken, and to seek specialist advice on the consequent adaptation priorities and needs. 

Perfect data does not exist

Data availability is a challenge for climate risk assessments and is extremely variable. There is detailed and accurate data for certain variables, and for other variables there is little or no data available. Imperfect data should not be a barrier for risk assessments, and it is appropriate to use a mix of quantitative and qualitative data. It is essential that the quality of the data is recorded and reported, and that entities undertaking climate risk assessments work with organisations that continually capitalise on data-related innovations.

The speed and scalability of new, richer and robust data sets is exciting. At Deloitte, we are proud of our data and technology innovations, and we prioritise accessing the highest-quality available data for our climate risk assessments. We pay attention to updates and staying current with the latest science (including the social sciences). If it turns out that decisions may have been driven by low quality and highly uncertain data, it can evidence the need for investment in new data sets which can be used to reassess risks prior to adaptation actions being identified.   

Fundamentally, it is about the things society values

The complex nature of multisectoral climate risk assessment at the state and national scales can be distracting. How to divide up systems, what metrics to use, and which data is appropriate at scale can drive anxiety around the task at hand and what the assessments are able to tell us. Fundamentally, though, multisectoral climate risk assessments are about thing we value, how they are connected and what climate change will do to those things. 

Stakeholder engagement is key 

Climate risk assessments require technically and scientifically robust impact information. The effects and timing of these impacts (along with hazards and overall vulnerability) can be modelled using a variety of sophisticated tools.  Despite the growing availability of risk assessment tools, nothing can replace the need for detailed and continual stakeholder engagement. It is critical to work with a broad range of stakeholders with diverse knowledge and opinions and varying levels of understanding about what should be prioritised, when those things are to be prioritised, and by whom and at which spatial and temporal scale. 

Without stakeholder buy-in and ownership of the problems, solutions and opportunities, the potential for action is reduced considerably. Stakeholder engagement also enables capacity building around climate change literacy and can drive innovation about potential solutions.  

Stay focussed on adaptation

While wrestling with information, data and knowledge, it is important to not lose track of the end point. That is, the leadership and strategy required to adapt, what needs to be done first, why, and what needs to be contributed.