November 25, 2021

Climate crisis for Indian firms estimated to cost $100 billion in the forthcoming five years: Study

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For the top economic firms have estimated to have an economic effect of ₹7.14 lakh crore (around US$100 billion) for the coming five years from the risks urged by the climate crisis, as per the report by CDP (formerly Carbon Disclosure Project), an organization which functions on international disclosure systems which are for investors, cities, companies, states and regions.

The report entitled as “Building Back Greener” revealed the figures were estimated based on the 42 responses from the 220 companies that answered to investor requests and revealed the climate data. From the 220 companies, which extended to CDP, 60 were in the top 200 of BSE.

The report emphasized on the growing disclosure needs were invoking more Indian businesses to wake up to the fear of climate crisis, and are dedicated to deducing the carbon footprints.

As many as 88 per cent of the 67 large companies extended by CDP which reported incentivising top management about climate-based actions: 99 per cent of the responding samples comprises of board level oversight of climate problems, revealed the report. From the 220 companies, 67 are large businesses and the remnants are micro, small and medium enterprises.

Damandeep Singh, Director, CDP India said, “Forty-two of 67 responding companies have monetised the economic impact of climate risks. The rest didn’t monetise the risks but did mention the risks they were facing. Most companies said they faced economic impacts from current and emerging regulations… They also fear emerging regulations like emission caps or emission trading schemes.”

Damandeep said there were various risks like the impact of climate crisis where valuation of the companies might fall, the future scenario of the oil and gas sector and effect on their reputations for appearing as not doing adequate.

The report revealed the four Indian companies – Hindustan Zinc, IndusInd Bank, Mahindra & Mahindra and Tech Mahindra have reached the CDP.

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