It’s the economy stupid, and it seems that a lot of executives are usin
g their brain power on their current worries rather than on the climate concerns of tomorrow—despite those concerns materializing in the here and now.
Executives are focused on meeting current economic challenges, putting in
tensifying environmental and climate risk concerns on the backburner, according to a study from Beazley.
The insurer’s Spotlight on Environmental & Climate Risk 2025 report includes obs
ervations from 3,500 global business leaders on how they perceive climate risk, th
e energy transition, greenhouse gas emissions and environmental damage to their operations.
The report shows that nearly two-thirds (73%) of them believe the current econo
mic climate makes meeting their sustainability targets less of a priority, and 67% are
finding it hard to transition to non-carbon energy and meet net zero targets.
Source: Beazley
Roughly one-third (34%) plan to increase energy efficiency this year,
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up from 23% in 2024, but only 19% see greenhouse gas emission risk as a significant concern (down from 24% in 2024).
“In the current economic environment executives are focusing on the here and now, risking missing the elephant in the room,” the report states. “The past year has seen Californi
a ablaze, deadly floods in Spain, and unprecedented storms, making extreme weather the new norm. These events cause devastation,
and increase the risk of environmental damage, commodity shortages, suppl
y chain and business interruption, yet just 20% (up from 18% in 2024) of global executive
s that we surveyed rank climate risk and associated catastrophic risk as a top concern.”
Renewables
There’s big opportunity in servicing—and insuring—renewables, if you were listen to what UN Secretary-General António Guterres is saying.
Guterres was addressing the 16th Petersberg Climate Dialogue in Berlin, during which he issued a strong call for decisive climate action.
He also called out some impressive stats about renewables and renewable growth:
2024 was a record year for global renewable energy production, according to the International Renewable Energy Agency.
Renewables made up 92% of new electricity capacity installed last year.
Europe’s capacity rose by 9%, with Africa’s capacity grew by 7%.
Wind power cost has dropped 60% since 2010, and solar is 90% cheaper.
Clean energy accounted for 5% of India’s GDP growth, 6% of the U.S. GDP and roughly one-third of the EU’s.
“All of this is another reminder of a 21st century truth: Renewables are renewing economies,” Mr. Guterres said. They are “powering growth, creating jobs, lowering energy bills, and cleaning our air.”
Extreme Weather
Climate change is causing more extreme weather around the globe, increasing the odds of severe drought and heavier precipitation.
California is an example of both: The state was facing another severe drought until 2023, when record-setting rain and snowfall led to heavy vegetation growth that helped fuel January’s destructive wildfires in Los Angeles.
