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Regulatory pressure adds to the need for action

But even if climate risk action is ‘displaced’ into nearer term priorities, there can be no doubt that stakeholder and regulatory pressures, through new reporting requirements such as the Corporate Sustainability Reporting Directive, mean the need for businesses to show greater efforts to mitigate and adapt to climate change will increase.

David Schechter, Claims Focus Group Leader - Environmental, Beazley notes that the series of lawsuits being brought by towns, cities and states across the US against oil producers alleging their role in causing climate change related damage may, depending on the outcome of these test cases, represent just the first wave. At present, these lawsuits are restricted to those deemed to be directly responsible, but we see a ripple effect extending out to businesses along the carbon fuels supply chain, from car manufacturers to transporters of oil and gas.

The spectrum of potential damages which businesses in the US are now exposed to, due to increasingly chaotic weather patterns, is also widening, with Californian companies now exposed to flood claims and Texans having to consider whether their pipes will withstand extreme cold.