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Cotton 2040: Interview with CottonConnect’s Hardeep Desai

Cotton 2040: Interview with CottonConnect’s Hardeep Desai

As part of the Cotton 2040 initiative’s Planning for Climate Adaptation workstream, climate two new studies were published describing the potential climate impacts to the cotton sector. The reports, one a global analysis of climate risks to cotton production in 2040, and the second a detailed climate risk and vulnerability assessment of cotton-growing regions in India, were launched alongside an interactive Climate Risk Explorer Tool. Together they are designed to help the industry take joined-up, informed and responsible action to build resilience to climate change.

In the light of the reports’ findings, we spoke with Hardeep Desai, Senior Director and Head of Farm Operations at CottonConnect South Asia, to get his reaction. CottonConnect is a social enterprise that works with retailers and brands to create business benefits by creating a more sustainable cotton supply chain. It is also a member of the Cotton 2040 Working Group.

Overall, how prepared are farmers for climate change?

The farmers enrolled in CottonConnect’s Sustainable Cotton programmes, such as the REEL Cotton Programme and Organic Cotton Programme, currently benefit from the educational and technical guidance provided by the CottonConnect team. As a result, they see positive results on their harvest with lesser use of pesticides, higher yield, saving water and turning around crop production as per weather suitability. 

Farmers face the brunt of the harsh climatic conditions but don’t have a strong collective voice yet required to bring changes on an environmental level. While most farmers do not know that some of the challenges they face are due to climate change, many of them are aware of steps to be taken in their farms. For example, in case of excess rain and waterlogging issues, they focus on good farm drainage and remove the water from the farm as early as possible using labour and other equipment. 

Some farmers know the solutions but do not have technical support or knowledge to implement them. Connecting farmers’ challenges with climate change initiatives and training and supporting them technically on climate-smart agriculture will hold the key. The farmers can foresee that the future will be tough, but the current focus also remains heavily driven on day-to-day sustenance.

Why and how will climate change impact women in particular? How do the findings from your study complement and support the Cotton 2040 analysis?

CottonConnect interviewed experts from five local partner organisations and conducted five focus group discussions, with around ten women farmers in each group, from REEL Cotton and Organic programmes, in India and Pakistan. As a result, we learned that climate change is already affecting all areas of women cotton farmers’ lives while they are on the farm or caring for their family or livestock or at home, which has a profound impact on their income, time and health.

These findings from our study complement and support the Cotton 2040 analysis. Both strongly indicate that the main climatic conditions will include acute water shortage, a higher number of days with increased temperature, average annual rainfall in fewer rainy days, prolonged dry spells between two rounds of rain affect the crop, thereby posing a threat to the livelihood of women farmers.

The Cotton 2040 analysis of the physical impacts of climate change on cotton production provides a valuable prediction for organisations working to impact the environment and women farmers positively.

How do these findings / your increased understanding of the climate impacts on the cotton sector impact your work? What’s most striking or relevant?

The changes in the climatic conditions will profoundly affect the farmers’ income, specifically in India and Pakistan, where agriculture and cotton crops play a crucial role in the countries’ economies. The economic impact will also deepen the labour-intensive farmers’ health issues who will continue to work manually in such extreme conditions.

CottonConnect will have to work much more closely with the farmers to educate and alleviate the changes in their livelihood in a much more focused manner backed by government laws, research and best practices. We will have to create climate-smart, climate-resilient farming communities that can understand the challenges caused by climate change on their farms and livelihoods and practice farming in a smart way. We want to partner with other organisations, too, who would like to support farmers in terms of technology and other interventions to address climate change issues.  

How are you already working to build climate resilience, e.g., with female cotton producers?

To understand the practical impact of climate change on rural communities, CottonConnect conducted a scoping exercise, including interviews and focus group discussions, to identify areas for future research and action. The findings from this study illustrate the specific ways in which women cotton farmers are affected by climate change.

Additionally, we educate the women farmers to improve farm profitability, adapt their crop planning according to the changing climate cycle, and work on gender-specific training on sustainable and socially responsible agricultural practices.

How do you plan to use the results from the Cotton 2040 study to feed into your work, e.g. with producers and brands?

The results and suggestions from the Cotton 2040 study will be shared across the supply chain cycles and sustainable departments of the brands and forums with which CottonConnect works. 

As a social organisation that focuses strongly on the farmers’ human, environmental and economic development and the brands it works with, we will work very closely with all our partners to reduce and minimise extreme weather events and temperature rise. We would also create a cadre of trained women as climate-smart change leaders who can work at the grassroots level and guide farming communities about climate change issues for a longer time period. These climate-smart leaders will act as a bridge between farmers and CottonConnect to bring change at the grassroots level. For this, we would be happy to collaborate with other agencies.

We will work on newer technological advancements and better farm management practices to improve irrigation systems.  And work with government bodies and other national and global agencies to develop climate-smart agricultural research and interventions for long-term impact.

Acclimatise acquired by Willis Towers Watson creating global powerhouse for climate resilience services

Acclimatise acquired by Willis Towers Watson creating global powerhouse for climate resilience services

Acclimatise has been acquired by leading global advisory, broking and solutions company, Willis Towers Watson. The move sees the Acclimatise team combine with Willis Towers Watson’s Climate and Resilience Hub (CRH), creating a market-leading centre of climate adaptation expertise with over fifty technical staff. The combination significantly expands the capacity of the CRH to meet growing demands for climate resilience services.

The CRH is the focal point for WTW’s work on climate risk and resilience, helping its clients to address the challenges associated with climate change across physical, transition and legal liability risks.  Acclimatise and the CRH have complementary capabilities in financial services, climate risk and vulnerability assessment, resilience planning and climate data analysis and risk modelling.

“Climate change risk is fast becoming a central part of government, corporate and financial decision making and planning. Meeting growing client demand will require increasingly sophisticated approaches to climate risk assessment and management.” Said Acclimatise CEO, John Firth. “This is why I’m hugely excited by the potential that Willis Towers Watsons’ acquisition of Acclimatise brings. I am very proud of Acclimatise’s achievements and our staff over its sixteen-year history – from kitchen table to a market leader – and am confident that combining with the Climate and Resilience Hub is the right move to ensure we can amplify the impact of our work.”

Welcoming the deal, Rowan Douglas, Head of the CRH, said, “By combining Acclimatise’s market-leading climate modelling and adaptation capabilities with Willis Towers Watsons’s deep experience in natural catastrophe modelling, risk management, re/insurance and investment markets we have a unique range of expertise to help clients manage climate exposures, seize adaptation opportunities and build more resilient societies and economies.”

The two companies have collaborated in the past and have enjoyed a strong working relationship. “We have long admired Acclimatise and what John Firth and Dr Richenda Connell have built as visionary leaders since 2004.” Said Douglas, “Our earlier collaboration via the Willis Research Network illustrated a shared market ambition, culture and complementary experience and relationships.  This feels like a very natural step for both teams. We are all excited about meeting the resilience challenges for corporates, Governments and financial institutions in the years ahead.”

The deal comes at a time where there is significant momentum behind climate risk services for corporates, Governments and the financial services sector. In recent years, WTW has increasingly mainstreamed climate risk across its business segments. John Haley, CEO Willis Towers Watson, said that the acquisition “is very much in line with our ambition to help clients navigate an increasingly complex world and to achieve climate resilience through the provision of market-leading solutions. Acclimatise’s capabilities and proven success in the area of climate risk, provide significant opportunities for us going forward. I am excited about what this means for Willis Towers Watson.”

Acclimatise becomes an official signatory of TCFD

Acclimatise becomes an official signatory of TCFD

Acclimatise today became an official signatory of the Financial Sustainability Board’s (FSB) Taskforce on Climate-Related Financial Disclosure (TCFD). The initiative, established by Mark Carney and Michael Bloomberg, has been central in providing momentum for climate change action in the financial services industry.

Acclimatise has worked with UNEP FI and the world’s leading banks to help consider how they might implement the TCFD recommendations. Through its work, Acclimatise has helped develop methodologies for assessing physical climate risk to loan portfolios and is a leading advisor on climate risk and opportunity to the financial services industry.

The company’s supporting statement under the TCFD reads:

“Aligning strategies to stabilise our financial and climatic systems is vital. Corporate and financial institutions have a significant role to play in this. The incorporation of TCFD recommendations in their governance systems and decision-making processes is in fact key if we are to ensure a sustainable and climate compatible future, particularly in light of unmet governmental climate targets. We are proud to support this initiative and we will continue to excel at developing methodologies and metrics to help corporates and financial services organisations to identify, quantify, and disclose physical climate risks and opportunities.”


For more information about Acclimatise’s work on climate risk and financial services click here.


Image: World Economic Forum: Mark Carney, Governor of the Bank of England. World Economic Forum, Davos, Switzerland. CC by 2.0.

Embracing uncertainty: How disclosing uncertain information on climate risk can reduce legal liability exposure

Embracing uncertainty: How disclosing uncertain information on climate risk can reduce legal liability exposure

By Marcela Scarpellini, right. based on science UG

As climate related damages increase, the need to allocate funds and apportion blame will inevitably follow. In this context, the mechanisms used for determining responsibility are likely to become, to say the least, very creative.

Pressure for proactive climate action and better response is mounting thanks to legislation and regulation, litigation, shareholder demands, citizens calling for more action, carbon taxes and concrete mitigation and adaptation plans.

The status and intent of current regulations relating to climate change and the legal infrastructure that is expected to support or deter the transition to a low carbon economy, provide a good indication of the stringency and certainty of the measures that will follow.

After Bank of England Governor Mark Carney’s famous warning in his 2015 speech regarding the threat climate change posed to our financial systems, financial institutions and governments started to wake up to the issue. This meant paying attention to – and developing an understanding of – how climate risks might play out and affect businesses future profitability and the stability of the wider financial system. In response, the G20’s Financial Stability Board established the Task Force on Climate-Related Disclosures (TCFD).

Point in time: Disclosure

The TCFD‘s purpose is to provide corporates and financial institutions with a framework for climate risk disclosure in two key respects. First, with regard to the analysis of the physical and transition risks and opportunities they may face due to climate change. Second, with regard to the development of appropriate strategies to respond to the consequences of those risks materialising.

This initiative, which already has 513 official supporters across businesses, advisory firms, and financial institutions, is a voluntary framework. The main political intention behind it – in combination with the EU Directive on Non-Financial Disclosures, EU Shareholders Directive and other upcoming EU financial regulation – is to foster transparency by requiring corporates and financial institutions to disclose information on material impacts of the physical and policy risks (transition risks) connected with climate change.

The TCFD recommendations are just a first step. Increasing transparency is a means to an end, not an end in itself: boilerplate and vague disclosures will not cut it. The intention of climate risk disclosures is to provide legislators with a broad understanding of the current state of investments and business bets into a certain world, in order to come up with evidence-based legislation that actually has a chance of reshaping our economies.

In this context, corporates and financial institutions have started to work out the best ways to generate relevant disclosures. The first attempts to generate this information using the TCFD framework have been released, but there is still a long way to go.

Hot topic: scenario analysis

One of the challenges of applying the TCFD framework has been the use of scenario analysis. Scenario-analyses are forward-looking tools intended to allow users to imagine how a range of possible futures could look, the risks and opportunities entailed in those different futures and get its users to pin down how their companies would be affected if any of those futures materialized. The overarching purpose is to enable firms to develop strategic and resilient business plans to incorporate envisioned or possible changes.

A concrete way in which companies make use of scenario analyses is by using them to understand how their capital requirements might be impacted under a range of plausible scenarios. Using scenario analyses, companies can peer into the future and build resilient responses to a world in which extreme events and their financial impacts are no longer sporadic but recurrent.

Scenario analysis is a time and capacity consuming challenge. Despite this, many companies, particularly within the oil & gas sector, have been using these tools for some time, and companies in other sectors are starting to do so too.

Another significant hurdle for companies performing scenario analysis stems from having to disclose the information generated. Many businesses are wary of this since, it is suggested, the information generated by scenario analysis is just hypothetical, which could, in turn, be misconstrued as a fraudulent, deceptive or incorrect disclosure, potentially opening the door to liability exposure. However, in reality, this constitutes a narrow view of the story.

Understanding risk

Properly understood, scenario-analysis is a risk assessment tool, so the information derived from it is the same in nature as information relating to other risks that might affect a company. Risks are hypothetical by nature and gain validity when substantiated through evidence and justification.

What it takes to reduce disclosure-related liabilities is a thorough and well-presented substantiation of the information provided, with clear and precautionary wording regarding how this information ought to be interpreted and construed.

A stream of forward-looking legal experts, within the Commonwealth Climate and Law Initiative, are of the opinion that disclosing forward-looking information in line with the TCFD Recommendations might, on the contrary, reduce liability exposure. Their claim is justified by understanding the core intentions of the TCFD’s recommendations, namely transparency and accountability. Therefore, firms able to demonstrate that they are acting to understand and manage climate risk will be acknowledged for that in the light of corporate responsibilities such as due diligence and good corporate governance. In understanding the purpose of disclosure, firms are allowed to make mistakes, though they are not allowed to be fraudulent, deceptive and manipulative about the future in order to ensure certain business interests.

As more firms get on board with the TCFD recommendations, using them as guidelines for disclosure, it is likely that they become reference points and that national laws start to be interpreted in light of the most advanced practices. In jurisdictions such as the UK, where an objective test applies to determine the extent and manner in which directors have exercised their duty of care and due diligence, this determination is likely to be done on the basis of what others in the industry are doing. If and when TCFD becomes best-practice, this is likely to become the yardstick against which these determinations will be made[1].

Good practice to reduce liability

Scenario-analysis remains a beneficial tool, despite the fact that it is still becoming an established best practice and mandated by law. To reduce firms’ concerns around liability associated with scenario-analysis, and to encourage them to start using it and disclosing climate risk information prudently, a series of recommendations follows:

  • Use proper cautionary language.
  • Use a variety of scenarios, at least three would be advisable.
  • Place all scenarios within the same section and under the same fonts in your disclosure as to avoid that any be interpreted as being favoured.
  • Use multiple sources for data and narratives and seek insights from new sources.
  • Use current data and justify your choice of providers.
  • Ensure your scenarios reflect the variance (climate, political, social, regulatory) and are relevant to the entirety of the company´s operations.
  • Use information derived from scenarios in order to justify likelihood and not infallible certainty.
  • Not disclosing any forward-looking information under the false pretence that it might make your company liable is a greater risk than disclosing uncertain information.
  • If you are not sure of how to go about it, hire consulting services to guide you along the way.

Further reading:

https://www.right-basedonscience.de/2017/08/04/better-safe-than-sorry/

Marcela Scarpellini studied law at the Universidad Católica Andrés Bello in Caracas (Venezuela) and has an LL.M. from the University of Stockholm (Sweden) in the field of environmental law. Within right.based on science (“right.”) she works at providing the legal context upon which right.´s X-Degree Compatibility (“XDC”) model and other metrics are developed.

right. based on science is a data provider founded in August 2016, which measures a single economic entity’s contribution, be that of e.g. a company or a lending project, to manmade climate change. With a team of experts with backgrounds in law, science, economics, psychology and mathematics, right. is devoted to the development of the XDC Model, which calculates science-based climate metrics on the basis of latest climate research and regulatory requirements, in order to deduct an entity’s X-Degree Compatibility.


[1] Concerns misplaced: Will compliance with the TCFD recommendations really expose companies and directors to liability risk? Alexia Staker, Alice Garton & Sarah Barker. Commonwealth and climate law initiative.


Photo by Krissana Porto on Unsplash

New York’s poor and ethnic minority neighbourhoods to be hit hardest by climate change finds NYC Panel on Climate Change

New York’s poor and ethnic minority neighbourhoods to be hit hardest by climate change finds NYC Panel on Climate Change

By Will Bugler

The New York City Panel on Climate Change (NYCPCC), released last month, its 2019 report on the science of climate change and its implications for New York City. The report finds that climate change is affecting everyday life in New York today, and that climate impacts will continue to increase over the coming decades, hitting the poorest neighbourhoods hardest.

The NYCPCC, which has been helping NYC prepare for climate change since 2008, found that extreme weather events are becoming more pronounced, high temperatures in summer are rising, and heavy downpours are increasing. The report finds that areas with lower incomes and the highest percentages of African American and Hispanic residents are consistently more likely to suffer the impacts of climate change. The panel advises that community engagement is critical for more effective and flexible adaptation efforts in the most at-risk communities.

The report serves as a “further wakeup call on the need to move urgently and take action on climate change” according to New York’s mayor Bill de Blasio. “This [report] shows what New Yorkers learned acutely during Sandy – climate change is real and an existential threat,” he said.

Records show that maximum daily summer temperatures have been rising at rates of 0.5°F per decade at JFK Airport and 0.7°F per decade at LaGuardia Airport since 1970. Sea level recorded at The Battery in lower Manhattan continues to rise at a rate of 0.11 inches per year since 1850. These changes are broadly in line with the climate change projections made by the NPCC in 2015.

The report also emphasises that climate change is already affecting the daily life of NYC residents, especially for those who live in coastal communities where nuisance flooding is becoming more frequent and for those who operate and use the city’s critical infrastructure during heatwaves and heavy downpours. Economic losses from hurricanes and floods have significantly increased in past decades and are likely to increase further in the future from more intense hurricanes and higher sea level rise.

“Recent scientific advances have allowed the NPCC to better detail climate vulnerabilities in the city, such as where nuisance floods might occur more frequently,” says William Solecki, co-chair of the NPCC. “This improved knowledge has, in turn, helped the panel craft new sets of tools and methods, such as a prototype system for tracking these risks and the effectiveness of corresponding climate strategies.”

One of those tools is the Antarctic Rapid Ice Melt Scenario, which the NPCC created to model the effects of melting ice sheets on sea level rise around NYC. The model predicts that under a high-end scenario, monthly tidal flooding will begin to affect many neighbourhoods around Jamaica Bay by the 2050s and other coastal areas throughout the city by the 2080s.

“The NPCC 2019 report tracks increasing risks for the city and region due to climate change,” says Cynthia Rosenzweig, co-chair of the NPCC and senior research scientist at Columbia University’s Earth Institute. “This report, the third by the NPCC in ten years, continues to lay the science foundation for development of flexible adaptation pathways for changing climate conditions.”

To help manage the dynamic climate and public policy contexts, the NPCC 2019 report recommends that the city put in place a coordinated indicator and monitoring system to enable the city and its communities to better monitor climate change trends, impacts, vulnerability, and adaptation measures. The report also notes that property insurance can be a catalyst for infrastructure resilience by encouraging investment in adaptation measures prior to a disaster through a reduction in premiums.

Other NPCC recommendations include:

  • continuing broad assessments of climate change across the metropolitan region with federal, state, and regional partners (for example, NOAA’s Consortium for Climate Risk in the Urban Northeast);
  • using updated methods for the next set of NPCC climate change projections; and
  • hosting a NYC Climate Summit once during every mayoral term.

Photo by Tommaso Ripani on Unsplash

Bank of England Governor indicates new climate risk rules are imminent

Bank of England Governor indicates new climate risk rules are imminent

By Robin Hamaker-Taylor

On 21st March, 2019, Bank of England Governor Mark Carney gave a speech at the European Commission High-Level Conference in Brussels, where he indicated that new rules from the UK’s financial regulators on climate risk are imminent.

Carney’s speech gives several indications as to the content of the upcoming PRA supervisory statement (SS) on banks’ and insurers’ approaches to managing the financial risks from climate change. The PRA’s SS will apply to banks, insurers and investment firms and will set out the PRA’s expectations regarding firms’ approaches to managing the financial risks from climate change, including with respect to: 

  • Governance, where firms will be expected to embed fully the consideration of climate risks into governance frameworks, including at board level, and assign responsibility for oversight of these risks to specific senior role holders;
  • Risk management, where firms will need to consider climate change in line with their board-approved risk appetites;
  • The regular use of scenario analysis to test strategic resilience; and
  • Developing and maintaining an appropriate disclosure of climate risks.

There have been important advances in both the supply and demand for climate reporting following the release of the final TCFD recommendations in 2017; support from both finance actors and companies has been resounding. Yet actual action on disclosure is lacking. According to Carney, financial implications are often not yet disclosed, and where they are, they are made in multiple reports making comparisons harder. Disclosures also vary considerably by industry and region.

Carney set out a vision for climate disclosure and made the case for regulatory action relating to it, stating that “in the future, disclosure will move into the mainstream, and it is reasonable to expect that more authorities will mandate it.” The role of financial regulators was delineated as well, suggesting that it is not their role to drive the transition to a low-carbon and resilient economy. Instead, financial regulators such as the PRA need to smooth the flow of investment into green technologies and encourage firms to plan over longer time horizons than normal; they ultimately operate within the climate policy frameworks that governments set.

A call was made for financial institutions to take a more strategic approach to climate, which Carney suggested requires scenario analysis; firms will need to consider scenario analysis as part of their assessments of the impact of climate risks on their balance sheet and broader business strategy. Specifically, Carney suggested scenarios should be:

  • Comprehensive, rigorous and challenging;
  • Transparent: the assumptions and methodologies in the models – such as the assumed global temperature rise, the energy mix, or whether the transition happens smoothly or abruptly – should allow for comparisons and external challenge; and  
  • Scenarios should be implemented consistently across the business, linking identification of risks and opportunities to both strategy and disclosure.

Scenario developments will be assisted by the PRA and FCA joint Climate Financial Risk Forum, which will work with industry to review tools and metrics, for the publication of reference scenarios and standard assumptions.

Finally, Carney explains that supervisors will require climate-related stress testing that links ‘high-level data-driven narratives on the evolution of physical and transition risks to quantitative metrics to measure the impact on the financial system.’ In conducting these stress tests, financial institutions would aim to:

  • Consider whether, across the financial system, financing flows are consistent with an orderly transition to the climate outcome set out in the Paris agreement. These long-term scenarios can facilitate discussions between firms and their clients about possible risks across different sectors and geographies; and
  • Consider whether the financial system would be resilient to shorter-term shocks – including a climate “Minsky moment” when climate risks materialise suddenly. 

The Bank of England will also work closely with colleagues in the Network for Greening the Financial System (NGFS) to develop a small number of high-level scenarios. Following the issuance of the draft supervisory statement and subsequent consultation in October 2018-January 2019, the final supervisory statement will be released in mid-April 2019.


Cover photo by Robert Bye on Unsplash.