Adaptation Private Sector Initiative - Showcasing good practice
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Partners of the initiative are already carrying out significant work on adaptation. Fifteen stories
of how business can help the poor adapt whilst increasing profitability.
Allianz Group: Insuring against climate impacts
and rewarding sustainable business practice
BASF: New technologies for climate change
Caisse des Dépôts: Climate-proofing
Cisco Systems: Improving governance through
Deutsche Post: Responding to
International Union of Railways: Climate-proofing
McKinsey & Company: Learning about the
economics of adaptation
Munich Reinsurance: Building alliances around
Ricoh: Conserving forests
Sagawa Express: Climate Savers
Siemens: Developing adaptation
Sompo Japan Insurance: Providing weather index
insurance in Thailand
Suntory: Conserving water resources
Thames Water: Adaptating business
Veolia Environment: Advancing climate
Allianz Group: Insuring against climate impacts and rewarding
sustainable business practice
Allianz have developed a number of
Insurance: Allianz first flood catastrophe bond – global –
part of a USD 1 billion programme to mitigate the risk of severe, regional floods across a
global fund. Eco-package – Hungary, US – a reduction in the premium for
corporate property insurance when environmentally friendly products or materials are used.
Micro-insurance: In India, Bajaj Allianz launched its
first microinsurance product in 2003, and went on to cover more than 100,000 customers. The
humanitarian crisis which followed the tsunami in 2004 prompted Allianz to team up with
CARE International, an organization with extensive experience in microfinance in India. The
partnership is focusing on providing tailor-made packages specifically for people who live
near the coast and work in fishing, agriculture and plantations. In
Indonesia, they are teaming up with GTZ to offer a microinsurance pilot
product, ‘Paying Keluarga’ (meaning ‘family umbrella’).
In Egypt, Allianz have worked in collaboration with Planet Finance,
Surety Fund and a number of European reinsurers to develop a pilot project offering death
and disability insurance to more than 30,000 customers.
Eco Trends Fund: The global fund invests in renewable energy,
environmental protection and water enhancement projects. Approximately 20% of the
fund’s assets are invested in emerging economies. As of June 2007, £938 million
was under this fund’s management.
BASF: New technologies for climate change
Coastal protection against floods: BASF is aware
that in many parts of the world, climate-related flood disasters cause devastating damage
putting thousands of peoples at risk. The consequences of such disasters are not only flooding
but also the loss of land. The regions at greatest risk are already raising the height of many
of their dike systems to as much as 9 meters. BASF is offering an innovative and
environment-friendly solution to provide effective and stable coastal protection. Through a
specially developed elastomer polyurethane system (Elastocoast) dikes are protected by absorbing the force of
the breaking waves and slowing down the water masses.
Plants with higher stress tolerance: Environmental
factors like heat and cold often determine the quality of the harvest. Climate-induced more
extreme weather conditions can put plants "under stress", so that they don't
provide the expected yield. That’s why BASF’s researchers are developing
stress-tolerant plants that are more resistant to extreme weather conditions such as
drought. This is to optimize crop plants such as corn, soy and wheat.
Reforestation through promoting sustainable
development: BASF initiated the foundation Espaço ECO (Brasil) in
cooperation with GTZ.
Espaço ECO focuses on promoting sustainable development by transferring knowledge
and technology, especially through the implementation of solutions in eco-efficiency,
environmental education and reforestation. Currently, superabsorbers are being trialed for a
reforestation project in the Brazilian rain forest. These superabsorber polymers have an
enormous water absorption capacity and can effectively store it in soil, thereby increasing
water storage capacity.
Caisse des Dépôts: Climate-proofing
In 2008 Caisse des
Dépôts has launched an international research programme on
adaptation focussed on designing and funding infrastructure. It is run by Mission
Climat, Caisse des Dépôts' research centre on the economy of climate change
and carbon markets. Because infrastructure has a long lifecycle and requires considerable
financial investment, it is essential to take into account climate change in the design of
new infrastructure and modify old infrastructure if necessary. This requires active and
effective debate between public decision-makers, companies and experts in climate change, as
well as the development of economic tools adapted to this type of funding. The research
programme is structured around two topics: An analytic topic which analyzes the
economic tools to be set up and Application modules which are supported by concrete
infrastructure management examples.
The international research programme addresses four themes (North-South problems; cities and
local government; water, agriculture and forests; industrial infrastructure; the financial
sector) as well as economic and financial instruments.
The first concrete application of the research is the launch of a “Cities and
climate change” club: Aimed at French local authorities who require additional
information on their role in this area, the club aims at clustering knowledge on both
management and financial issues within the scope of infrastructure and climate change. It
focuses on possible mitigation and adaptation measures involving urban infrastructure and its
funding. Three annual meetings are organized for French local authorities and public service
companies – water and energy use and supply, buildings and land development,
transportation – to discuss climate change and infrastructure with economics experts.
The first meeting was on energy infrastructures (how to adapt them to climate change and
reduce greenhouse gas emissions); the second one was on flood risks management.
Cisco Systems: Improving
governance through technology
The Climate Change practice of the Cisco Systems Strategy &
Innovation Group (IBSG) is researching an initiative to reduce emissions from
deforestation in developing countries with co-benefits for climate change adaptation and the
conservation of forest ecosystems. Cisco Systems is developing innovations that help to
address the market and governance failures which allow this practice to continue.
To this end, they are developing proof-of-concepts and prototypes which help manage decision
making processes in deforestation hotspots by monetising forest property rights so that
carbon sequestration services can be priced and managed. The 'rainforest skin' is an
open network platform for real-time, highly distributed mass remote sensing, certification
and monitoring of carbon stocks and flows that generates trust and enables collaboration
between different actors in government, communities/NGOs/scientific organizations and the
private sector. This platform will use a 'mash-up' of geo-referenced satellite,
unmanned aerial vehicle and multiple ground based sensor networks to estimate the
forest's carbon stock and flow dynamics and then allow for trading and risk management of
this new commodity.
This effort is part of a wider global sensing and monitoring R&D collaborative effort
with NASA and other partners to co-develop a Planetary Skin that goes beyond carbon sensing
in rural and urban environments into critical sectors including water, food productivity and
Deutsche Post: Responding to disasters
Deutsche Post have
Management as one of the four areas of their global CSR engagement (alongside Health,
Education and Environment), in order to respond to more frequent and severe weather events
and to assist the international community in responding to major natural disasters
exacerbated by climate change. Activities include Disaster Preparedness, and Relief
and Reconstruction. Having supported relief efforts for many years, in 2005, Deutsche Post
initiated and launched a global humanitarian partnership with the United Nations
(specifically the United Nations Development Programme (UNDP) and the United Nations Office
for the Coordination of Humanitarian Affairs (UN OCHA)).
By the end of 2007, Deutsche Post established a global network of DHL Disaster Response
Teams (DRTs). The DRT network consists of three regional teams (DRT Asia-Pacific, DRT
Middle East and Arica, DRT Americas). DRTs are made up of expert volunteers and respond to
formal requests from UN-OCHA and national governments. All of them have now been trained and
equipped and ensure that the DHL DRTs are ready for deployment anytime and anywhere.
In addition to its Disaster Response engagement, in collaboration with UNDP and the
government of Indonesia, Deutsche Post have developed a training concept to reduce
the effects of natural disasters over the long term, by preparing airport
authorities to improve their response in times of disasters. Deutsche Post's work in
Indonesia was a focussed effort designed to find a robust approach to disaster preparedness
that could be transferred to and implemented in other at-risk countries.
International Union of Railways (mixed public and private membership): Climate-proofing
The Internation Union of Railways (UIC)
has undertaken an extensive feasibility study analyzing the impacts of climate change on rail
transportation infrastructure and taking stock of ongoing and planned work on climate change
adaptation in European, Canadian, Australian and Indian railway companies. This includes case
studies of the UK West Coast and the German Rhine Valley. This led to the Adaptation of Railway
Infrastructure to Climate Change (ARISCC) project proposal that will produce information on the
costs of adaptation, risk assessments, potential damages, a toolbox for identifying vulnerable
assets and locations for a given line, a good practices collection and options for adopting
standards to climate-proof new and existing infrastructure to climate change impacts.
McKinsey & Company: Learning about the economics of adaptation
McKinsey's Climate Change
Special Initiative is a cross-functional and cross-sectoral effort, which brings
insights, experience, and expertise from all parts of the firm to help advise the world's
leading institutions on the impacts of climate change. McKinsey are working to deepen the
understanding of climate change; its implications for industries such as travel and
logistics, biofuels, and financial services; and are also working on climate change
strategies, low-carbon operations, low-carbon growth markets, and risk management. To this
end, McKinsey recently created the Social Sector Office (SSO) to
ensure the best capabilities of McKinsey are available to help leading institutions address
In order to further knowledge on climate change adaptation, McKinsey is undertaking studies
on the economics of adaptation - the physical impact of climate change on the social and
economic well being of societies around the world - through a partnership between the
firm's Climate Change Special Initiative and the Social Sector Office. Efforts are
focused on providing pragmatic fact based information to decision makers by assessing the
impacts of climate change as well as a range of adaptation measures including risk avoidance,
risk reduction, and risk transfer. Efforts in this area are emerging as McKinsey is
collaborating with lead international organizations such as the UNFCCC.
Munich Reinsurance: Building alliances around climate insurance
The Munich Climate Insurance
Initiative (MCII) was launched by Munich Re in April 2005 in response to the
growing realization that insurance-related solutions can support adaptation to climate change
as advocated by the UNFCCC and its Kyoto Protocol. This initiative brings together insurers,
experts on climate change and adaptation, NGOs and policy researchers intent on finding
solutions to the risks posed by climate change. MCII provides a forum and gathering point for
insurance-related expertise on climate-change impact issues.
MCII strives to fulfill four objectives:
- Facilitate insurance-related solutions to help deal with the impact of climate change
using the combined resources and expertise of the public and private sectors;
- Conduct and support pilot projects for the application of insurance-related solutions in
partnerships and through existing organizations and programmes. Identify success stories and
disseminate information on the factors necessary to design and implement effective climate
insurance-related mechanisms. These activities will focus on developing countries but will at
the same time involve the evaluation of insurance solutions that have been used in developed
- Promote insurance-related approaches in cooperation with other organizations and
initiatives and within existing frameworks such as the United Nations, international
financial institutions, international donors and the private sector;
- Identify and promote loss-reduction measures for tackling climate-related events.
MCII was founded by representatives of Germanwatch, IIASA, Munich Re, the Munich Re
Foundation, the Potsdam Institute for Climate Impact Research (PIK), the Swiss Federal
Institute of Technology (SLF), The Energy and Resources Institute (TERI), the Tyndall Centre,
the United Nations University Institute for Environment and Human Security (UNU-EHS), the
World Bank, and independent experts. The group is open to new members (e.g. representatives
of other insurance or reinsurance companies, climate change and adaptation experts, NGOs and
policy researchers) seeking solutions to the risks posed by climate change.
Ricoh: Conserving forests
Ricoh carries out conservation
projects as part of corporate social responsibility. Working with non-profit organizations and
local residents, Ricoh implements nine forest ecosystems conservation projects in eight
countries. Ricoh is financing these projects through a social contribution reserve to which 1%
of annual profits are allocated. Ricoh has completed three such multi-year projects in 2007
(Restoration of Temperate Forests and Giant Panda Habitats in Wolongin; Restoration of Satoyama
in Bangladesh; Conservation and Restoration of Forests at World Heritage Sites in Sri Lanka)
and two further projects in China and Brazil were initiated in 2008.
Sagawa Express: Climate Savers
Express has developed and is putting into practice the Climate Savers Program to reduce
emissions and mitigate the impacts of climate change.
Siemens: Developing adaptation technology
SkyHydrant system: To help the UN achieve the goal of reducing the number
of people without access to clean water to one half of today's level by 2015, a team from
Siemens Water Technologies has developed the portable water-purification system SkyHydrant
and established the SkyJuice Foundation to ensure the system will be used effectively in
developing countries and disaster areas. SkyHydrant purifies unclean water by pumping
it through a membrane of ultra-fine fibers. The result is exceptionally pure drinking water
that surpasses World Health Organization (WHO) quality specifications. The system does not
require electric power or purification chemicals, and with annual costs of less than 20 euro
cents per person, it is affordable for even the poorest communities in developing countries,
including those communities affected by climatic disasters. To date, the SkyJuice Foundation
has installed around 450 systems in 16 countries on 4 continents.
Water Purification - Desalination Power: Siemens has won a competition
staged in June 2008 at the first "International Water Week" exhibition in
Singapore. The Singapore government announced at the exhibition that it was providing USD 3
million in research funding for the "Singapore Innovative Technology Challenge."
The goal was to find a technology capable of cutting in half the cost of converting seawater
into drinking water and thus help the government’s efforts in establishing a secure
water supply for the country. The concept of Siemens was not to desalinate seawater by
means of energy-intensive heating and vaporizing processes, but by channeling water
through an electric field. This reduces energy consumption per cubic meter of water from the
ten kilowatt hours (kWh) common at conventional facilities to just 1.5 kWh. Even the best of
the previous technologies based on reverse osmosis used twice this amount of energy.
Pure Water: Recycling Wastewater: Siemens has assisted the Singapore
government in supplying much needed fresh drinking water as about half the country’s
requirement of water currently needs to be imported from Malaysia. Siemens provides a
wastewater purification system which filters water to required World Health Organization
(WHO) and the U.S. Environmental Protection Agency (EPA) standards. A water purification
plant in Kranji is now being expanded. By 2012, its capacity will be boosted to 210,000
m³ per day in order to meet 20 % of the city's water requirements. The additional
expansion is possible because the Siemens’ recycling process is cost-effective and much
cheaper than other water purification methods such as desalination. Concerned about water
resources, a number of delegations from other Asian countries have also expressed their in
State-of-the-art technology by Siemens is making it possible to reduce
energy consumption in buildings by up to 30 %. Buildings, such as the New York Times Building
(NYTB) and the 30 The Bond office complex in Sydney, demonstrate what can be achieved for
people and the environment when sensors, special materials, energy supply systems, and
information technology interact in an optimal manner. Siemens have developed building
management systems that automatically monitor and control the air conditioning, water
cooling, heating, fire alarm, and generation systems.
Sompo Japan Insurance: Providing weather index insurance
Sompo Japan Group is developing
a new Weather Index Insurance scheme for farmers in northeast Thailand as an option for
adaptation. Since 2007, Sompo Japan Risk Management and the Japan Bank for International
Cooperation have been jointly studying risk finance schemes that utilize insurance, identifying
weather index insurance as the most effective scheme.
Most farmers in north-east Thailand, where there is a shortage of water resources, rely on
rainfall. As a consequences, harvests can fluctuate greatly depending on meteorological
conditions. The development of weather index insurance requires highly reliable long-term
meteorological data. Khon Kaen Province has relatively precise meteorological weather
stations, making it a suitable target for product development. Insurance coverage as well
as penetration rates are low - Thai farmers are unfamiliar with insurance and struggle to pay
back loans taken for agricultural equipment. In response, Sompo Japan decided to develop
a new scheme to sell an insurance product with loans from Thailand’s Bank for Agriculture
and Agricultural Cooperatives (BAAC). Between April and June 2008, Sompo Japan made a
trial product, prepared fliers in Thai for the product, and conducted interviews with local
farmers. BAAC expects the product to succeed; in May 2009, a simulation for
full-scale product development was started and Sompo Japan is preparing to launch the product
Suntory: Conserving water resources
Suntory Limited is making the
conservation of water resources the axis of their environmental activities in line with their
corporate message "Water for Life, Suntory". Suntory are carrying out work to
protect water sources and forests ("Forests of Natural Water") focused on the forests
that serves as sources of water for their plants in cooperation with national and regional
administrations across Japan. The company has opened the Suntory School of Forest and
Water to provide environmental eduction for elementary school children. In addition to
these activities, the company also has a long-running "Save the birds" campaign and
is supporting bird conservation through a designated fund.
Thames Water: Adaptating business operations
Thames Water are adapting
to the impacts of climate change as part of core business strategy. Thames
Direction Statement (SDS)
outlines how Thames Water will respond to a wide range of issues including climate change,
leakage and improving water efficiency whilst delivering high quality customer service from
2010 to 2035. The SDS was a culmination of Thames Water's largest-ever public
consultation exercise, which included discussion groups with customers, stakeholder workshops,
interviews with MPs and an online consultation, prompting over 2,600 individual comments.
The SDS has identified three main areas for action between 2010 and 2015:
Thames Water are actively building capacity both in terms of assets and employees
to ensure that their business is able to respond effectively to the impacts of climate change,
working within their business and with local communities. In 2008, Thames Water started to
actively engage their supply chain on climate change, adaptation, carbon and
sustainability. A workshop was held. Thames Water have challenged their suppliers
to consider their contribution to climate change, what adaptation actions they need to take to
ensure they can maintain service levels to the business as climate change impacts increase and
to also to begin to assess the carbon intensity of the goods and services they provide.
Water Resources - climate change has been specifically taken into account
Sewerage/Sewer Flooding - improve the understanding of catchments and climate change
with respect to sewer flooding between 2010 and 2015. Also - uplift design standards for
new assets to a 1 in 30 year level of flood protection.
Flood Resilience - Thames Water have undertaken assessment using Environment Agency
guidance looking at the potential risk of a 1/100 flood + 20% and are developing a staged
plan to improve protection between 2010 and 2020. They have also worked closely with
financial regulator (Ofwat) on the development of an analytical framework to assess asset
resilience to flood hazards.
Veolia Environment: Advancing climate knowledge
The Veolia Environment
Institute is a think tank founded in 2001 in France as a non-profit
organization, by the company Veolia Environnement. It is dedicated to promoting
long-term thinking and to anticipating the trends that will mark the interactions between
society and the environment.
The Institute develops three instruments to achieve its objectives: a research
programme led in collaboration with academic partners, a series of
international conferences, and a
scientific editorial policy. Besides
other areas of concern (economic dimensions of the environment, links between health and the
environment, urban growth imperatives, society and environmental issues),
climate change is a focal point of investigation.
Some examples of major projects that have been carried out by the Institute include:
- comparing the ecological footprints of different models of energy consumption in the
urban areas of developing countries;
- exploring issues raised by the Stern Review Report on the Economics of Climate Change;
- studying “factor 4” scenarios in the most advanced economies;
- providing forum for discussion about the energy, environment and poverty nexus in India;
- assessing technology and policy solutions during the “Climate 2050”
Conference in Canada.
These activities mark the Institute's determination to ground its actions and its future
plans in ongoing fruitful dialogue with academic and international circles. All the results
are available thanks to an open access policy.
The Institute derives much benefit from the diversity of situations in which the Veolia
Environnement Company has been professionally involved worldwide. These potential case
studies constitute an extremely precious resource of data and represent a vast field of
observation and analysis for the think tank’s scientific partners.
In return, the Institute’s work offers to the Veolia Environnement Company a long-term
vision of the major challenges that the environmental services sector will be likely to face
in the coming decades. For Veolia Environnement more particularly, the management of GHG
emissions is a responsibility and more often an opportunity to develop expert services for
the benefit of its clients.