COMMENT: There’s a reason climate change is ever-present in our news cycle: globally, it’s the biggest risk we face. We know that it is affecting us now, but the question of how we respond to it in the future remains largely unanswered across British business, writes Tom Byrne, sustainability manager at Landsec.
Understanding the risks of climate change is especially important in the property industry, where our assets are constantly exposed to the elements and must keep the people who use them safe.
Landsec’s retail portfolio has a wide geographical spread across the UK, which means understanding the differing risks future climatic trends could bring is crucial.
The future events and conditions experienced by Buchanan Galleries in Glasgow, for example, will be very different from those felt in Portsmouth, where Gunwharf Quays is located.
The reporting recommendations released by the Financial Stability Board’s Task Force on Climate-Related Financial Disclosures in 2017 encourage companies to be more transparent on how they contribute to and are affected by climate change, with the intention of allowing investors to make better choices.
This will help fund managers divest high-impact, fossil fuel-heavy stocks and move toward cleaner investments, but it also acts as a crucial reminder for businesses to consider the risks they face because of changes to the climate – from loss of trading to increased operating costs and physical damage to assets.
How can the property sector help create a sustainable future?
Ahead of our TCFD disclosure this year, Landsec partnered with the strategic risk team from Willis Towers Watson to ensure we understood the impact that climate change would have on our business in differing climatic scenarios.
We looked at the consequences for the UK in a world becoming two degrees and four degrees warmer.
We studied how these temperature rises would affect sea levels and rainfall, the patterns and severity of storms and the ability of our assets to provide the conditions our customers require.
In the near term, to 2030, the results of our study aren’t as severe as people might assume.
The UK benefits from a unique position when it comes to climate change, with the impacts of rising temperatures manifesting themselves more harshly abroad.
Cooling costs will increase as a result of higher temperatures sustained for longer, but heating costs will decrease, with these two effects balancing each other out.
Our analysis suggests that flooding and storm activity, which feel more regular in today’s climate, won’t intensify in the UK in the lead-up to 2030.
But in the long term, after 2030, the risk picture is likely to change.
According to our study, flooding, coastal floods and storms will increase in regularity and will become even more intense.
Our cities will feel more European in temperature, and infrastructure such as sea and flood defences will become increasingly important.
As an industry, therefore, we will need to adapt building services design and optimise existing systems to ensure heating and cooling can be delivered efficiently with changing demands.
Property companies with older assets will need to think hard about how to manage rising cooling requirements and future developments will need to be constructed with resilience to flooding and high winds in mind.
The property sector is responsible for a large proportion of the UK’s greenhouse gas emissions, and as an industry we have a huge role to play in reducing the severity of climate change.
It’s clear that temperatures are already on the rise, and the risks of climate change need to be taken just as seriously as the causes.
