Country, Date, Presenter Presentation Module 3b Identifying and Prioritising Climate Change Adaptation Measures Country, Date, Presenter

Objective The objective of this module is to: learn about adaptation and measures strategies get to know different types of positive side effects review by which criteria adaptation measures are compared and prioritized 20/11/2018 Title

Adaptation Strategies & Measures Selection of Adaptation Measures Outline / Agenda Adaptation Strategies & Measures Selection of Adaptation Measures Positive Side-Effects and Competitive Advantage 20/11/2018 Title

I. Adaptation Strategies & Measures 20/11/2018 Title

I. Adaptation Strategies & Measures - Overview Adaptation is essential to a company‘s climate resilience as it greatly influences how severely climate impacts and risks eventually manifest as negative business effects- or whether positive side effects can be leveraged. Adaptation strategy plays a key role in this process. The more sophisticated and planned through it is, the better negative effects from climate change on the business can be fought off. Strategy is "the determination of the basic long-term goals and objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out these goals.” - Peter Drucker - Source pic 1: http://www.oxfam.org/en/development/india-coping-flood-situations 20/11/2018 Title

Anticipatory Adaptation Integrated Adaptation I. Adaptation Strategies & Measures - Flood protection measure – timing and integration Time Adaptation made afterwards Reactive Adaptation Anticipatory Adaptation Integrated Adaptation Company anticipates and prepares for changes and integrates it to its biz model / supply chain No anticipation of impacts and / or no action Company severely affected Company somewhat affected Improvements made to single measure Company anticipates changes and prepares for them Company might even profit Improvements made to strategy Flooding occurs adapt Source pic 1: http://www.oxfam.org/en/development/india-coping-flood-situations 20/11/2018 Title

I. Adaptation Strategies & Measures - Overview After being clear about the adaptation strategy, you have to opt between different adaptation measures. These comprise technical (grey), ecosystem-based (green), or solutions concerning management issues (soft). Multiple factors influence the nature of adaptation measures, which in the end, must also coincide with your adaptation strategy: For example, ask yourself if a measure should only be cost-effective or also contribute to achieving social and environmental co-benefits? Grey Green Soft Source pic 1: http://www.oxfam.org/en/development/india-coping-flood-situations 20/11/2018 Title

I. Adaptation Strategies & Measures - Technical measures (grey) Source: Oxfam Source: http://www.applegateinsulation.com Technical measures chiefly reduce the physical vulnerability of a company, locations of production or processing Examples: insulation for buildings, flood- and storm-resistant construction of buildings, physical barriers to protect buildings from flooding Features: immediate risk reduction, medium- and long-term pay-offs 20/11/2018 Title

I. Adaptation Strategies & Measures - Green adaptation measures (green) Source: adelphi Source: http://www.geograph.org.uk Ecosystem‑based adaptation measures often make use of and equally sustain ecosystems and their services, hence contributing to the sustainability performance of a company Examples: installation of flood storage areas, planting of trees, green roofs and walls Features: low-cost, flexible solutions to increase the adaptive capacity and to limit climate change impacts Source pic 1: http://www.oxfam.org/en/development/india-coping-flood-situations 20/11/2018 Title

I. Adaptation Strategies & Measures - Managerial adaption measures (soft) Managerial solutions do not include physical infrastructure but rather deploy digital services or knowledge and capacity building measures Examples: monitoring of environmental data and adaptation progress within the company, taking up climate change relevant insurance (e.g., flood insurance), formation of a climate adaptation team Features: adaptation to increase the internal / organisational capacity and ability to deal with climate change Source: adelphi 20/11/2018 Title

I. Adaptation Strategies & Measures - Adaptation options Flexible or adaptive adaptation options involve putting in place incremental adaptation options rather than undertaking large-scale adaptation at one point in time Win-win actions contribute to adaptation whilst also having other social, economic and environmental policy benefits, including those relating to mitigation Adaptation options Win-Win options Low regret options Flexible/ adaptive mgmt. No regret options Adaption measures can be classified according to the benefits they yield. No-regret actions are cost -effective under current climate conditions and are consistent with addressing risks of climate change, they possess no hard trade-offs with other policy objectives Low-regret actions are relatively low cost and provide relatively large benefits under predicted future climates Source pic 1: http://www.oxfam.org/en/development/india-coping-flood-situations Source: UKCIP & Martin 20/11/2018 Title

I. Adaptation Strategies & Measures - Example: Response of a food processor facing more heatwaves Negative effects on the business in the area of Potential adaptation measures Buildings and infrastructure Secure and increase water sources Processes Water recycling system Logistics and stock Heat-resistant roof for storage depot Employees and community Collaboration with community for joint water management Market Product offer with heat-protecting packaging Finance Credit for energy efficiency investment Source pic 1: http://www.oxfam.org/en/development/india-coping-flood-situations 20/11/2018 Title

I. Adaptation Measures and Strategies - Example: Response of a chemical company to flooding risks Negative effects on the business in the area of Potential adaptation measure Buildings and infrastructure Secure most important machinery from floods Processes Close unwanted leakages Logistics and stock Emergency plan for keeping up supply to market Employees and community Emergency plan for employees Market Regional diversification of buyer base Finance Insurance against damages from extreme weather Source pic 1: http://www.oxfam.org/en/development/india-coping-flood-situations 20/11/2018 Title

II. Selection of Adaptation Measures 20/11/2018 Title

Awareness Raising Workshop on CCA 2015 II. Selection of Adaptation Measures - Overview of steps in strategizing adaptation Select risks to address from the risk assessment Identify measures (grey, green, soft) Assess measures according to criteria Select measure(s) to be implemented After having picked several adaptation measures, it is crucial to scrutinize their suitability and effectiveness by an array of criteria. Source pic 1: http://www.oxfam.org/en/development/india-coping-flood-situations 20/11/2018 Awareness Raising Workshop on CCA 2015

II. Selection of Adaptation Measures - Multi-Criteria Analysis Feasibility Grey Green Soft Potential for cost reductions Synergies with other measures Positive environmental and social impacts Reversibility Technical feasibility Internal feasibility (skills) Investment and running costs Potential for risk reduction Positive side effects / Competitive advantage By what is called a Multi- Criteria Analysis, the shortlisted measures can be evaluated and ranked. On climate / environment / community On existing processes and approaches Negative side effects 20/11/2018 Awareness Raising Workshop on CCA 2015

II. Selection of Adaptation Measures - Multi-Criteria Analysis The criteria partly contain several sub-aspects. To simplify, the following questions give you an understanding about each one’s core objective: Potential for risk reduction: How helpful is the measure? Will it be necessary to implement additional measures to fully tackle the risk? Feasibility: Does the company have the required resources to implement the measure? Positive side effects / competitive advantage: Does the measure have positive effects on aspects of the business which had not been targeted by it? Negative side effects: Will other aspects of the business, the environment, or external stakeholders such as communities suffer from the implementation of the measure? 20/11/2018 Title

III. Positive Side Effects and Competitive Advantage 20/11/2018 Title

III. Positive Side Effects and Competitive Advantage – Example: Cost savings through risk reduction measures Adaptation measures that –while reducing risks – entail positive side-effects, are especially attractive. Drip irrigation as a response to lowered rainfall, for example, mitigates the vulnerability of collapsing groundwater aquifers (risk reduction) and decreases operational costs (gains in competitiveness). JobyElliott, CC BY 2.0 Alongside positive side effects, adaptation measures may also cause negative effects. 20/11/2018 Title

III. Positive Side Effects and Competitive Advantage – Four Types Opportunities for cost reduction in operations 1. Operations Opportunities for improving a company’s reputation among key stakeholders 2. Reputation Opportunities for developing the skill-base of the future 3. New skills and repositioning Opportunities for anticipating regulation and becoming a first-mover 4. Regulation Competitive advantage resulting from risks reducing measures Add examplary adaptation measures by companies that have been implemented in your country 20/11/2018 Title

III. Positive Side Effects and Competitive Advantage – Operations Competitive advantage through cost reduction How? Introducing technologies / measures which reduce the resource intensity of production processes and products Benefits Cost savings through greater efficiency and effectiveness Add examplary adaptation measures by companies that have been implemented in your country Example Integrated water-, waste- and energy management Reduces vulnerability to climate change impacts Reduces costs due to lower resource consumption 20/11/2018 Title

III. Positive Side Effects and Competitive Advantage – New Skills and Repositioning Competitive advantage through a strategic repositioning Review internal processes and skills: are they adequate to address risks and seize opportunities from adaptation? Innovate internal processes to be future-ready Reposition skill-base towards future-oriented markets How? Benefits Long-term sustainability of the business Competitive advantage through early repositioning Add examplary adaptation measures by companies that have been implemented in your country Example Implement training programmes on energy-efficiency for your staff Integrate an environmental engineer in your team who can increase the resource efficiency of your products 20/11/2018 Title

III. Positive Side Effects and Competitive Advantage – Reputation Competitive advantage through greater trust by stakeholders Through dialogue, marketing and cooperation activities which target the community, company staff and their families, local authorities, customers and investors How? Consumer loyalty, social peace with regard to community, better access to financing, improved relations with government institutions Benefits Add examplary adaptation measures by companies that have been implemented in your country Example Projects with communities to develop and implement adaptation measures benefiting company and community Avoid conflicts with neighbouring communities Demonstrate social responsibility 20/11/2018 Title

III. Positive Side Effects and Competitive Advantage – Regulation Competitive advantage from anticipating regulation Monitor developments in the regulatory field concerning adaptation topics (water efficiency, toxic discharge etc.) Engage in dialogue with policy makers Prepare your business for potentially upcoming regulation How? Benefits Advantage over competitors as you achieve compliance early on, while competitors are punished for non-compliance Early access to upcoming support or funding schemes Add examplary adaptation measures by companies that have been implemented in your country Example Keep yourself informed about regulatory developments through participation in industry fora, dialogue processes etc. Develop actions plans / implement measures proactively 20/11/2018 Title

Experience from practice – Examples of Climate Expert implementation 20/11/2018 Title

Discussion – Climate Change Phenomena, Impacts & Adaptation How well are SMEs in your country planning or implementing adaptation measures already? Generally speaking, what kind of adaptation measures do you find most appealing? A lot of attention was paid to the positive side effects: Have you had experience with negative side effects? 20/11/2018 Title

Thank you for your attention! GIZ Germany Ms Janina Wohlgemuth +49 (0) 6196 - 79 – 1245 janina.wohlgemuth@giz.de www.giz.de adelphi Germany Mr Frederik Eisinger +49 (0) 30 - 89 000 68 – 69 eisinger@adelphi.de www.adelphi.de 20/11/2018 Title

Sources CSC, GIZ, Wageningenur, & BMUB, 2011 : Climate Fact Sheet Rwanda, extract from Climate Report 2011. Available at: http://www.climate-service- center.de/imperia/md/content/csc/kongo/fact_sheet_climate_rwanda.pdf C2ES, 2011: Extreme weather and Climate Change. Available at: http://www.c2es.org/publications/extreme-weather-and-climate-change C2ES 2013: Weathering the Storm: Building Business Resilience to Climate Change. Available at http://www.c2es.org/docUploads/business-resilience-report-07-2013- final.pdf GIZ & adelphi 2013: Trainers Maunal. Facing the Impacts of Climate Change. Indian SMEs and Climate Change. Available at: https://www.giz.de/de/downloads/giz2013-en-trainer-manual-sme_small.pdf Martin, Suzanne: Examples of no-regret, low-regret and win-win adaptation actions. Available at: http://www.climatexchange.org.uk/files/6713/7365/7183/adaptation_noregret_actions.pdf McKinsey & Company 2015: How Companies can Adapt to Climate Change. Available at: http://www.mckinsey.com/business-functions/sustainability-and-resource- productivity/our-insights/how-companies-can-adapt-to-climate-change UKCIP: Identifying Adaptation Options. Available at: http://www.ukcip.org.uk/wp-content/PDFs/ID_Adapt_options.pdf 20/11/2018 Title