Given the recent wildfires in L.A. and ever-escalating costs from extreme weather events across Canada annually, concern is mounting of the potential impacts on major urban centres. A new KPMG survey reveals nine out of 10 Canadian business leaders are concerned about the potential for an urban climate disaster in the country.
"As wildfires rip through parts of Manitoba and northwestern Ontario, and after what we witnessed in L.A., it no longer matters where you live – whether it’s in Canada’s remote boreal forest or in the middle of a major city – the growing intensity and frequency of extreme weather events makes everyone vulnerable," Roopa Davé, a Vancouver-based partner and KPMG Canada’s national climate risk leader, said in a statement.
Taking precautions
The devastating wildfires that swept through Los Angeles earlier this year are sparking alarm far beyond California. North of the border, a significant majority of Canadian business leaders are taking the warning signs seriously and making changes.
According to a recent survey of 351 Canadian business decision-makers, 91% say they are now more concerned about the impact of extreme weather on their operations. The fires have served as a wake-up call, prompting more than two-thirds of respondents to begin actively preparing for climate-related disruptions.
The level of concern is striking: 61% of business leaders describe themselves as “extremely concerned.” Of that group, nearly half (43%) have already implemented precautions. Another 31% say they are “somewhat concerned,” and within that segment, a quarter (25%) are also taking preventative steps.
These worries are grounded in experience. Many of these businesses felt the sting of climate impacts last year. Nearly seven in ten (68%) reported a hit to their bottom line due to extreme weather:
- 30% said their profits dropped by 6% to 10%
- 14% saw losses between 11% and 25%
- 6% endured profit declines exceeding 25%
- Another 18% experienced smaller setbacks — up to 5%
As climate risks move from distant threat to daily business reality, Canadian companies are recalibrating their risk strategies, because for many, doing nothing is no longer an option.
Investing in the future
Since nearly half of respondents say their costs rose significantly, and just over half experienced interruptions to their supply chain, many are taking steps to mitigate future calamities that may arise.
Specifically, 53% are investing in infrastructure modifications to withstand extreme weather. This may include retrofitting buildings to be more heat-resistant, embracing adaptive architecture or incorporating permeable materials and green infrastructure to manage stormwater runoff and reduce flooding, according to Davé.
Nearly eight in 10 are investing in data, analytics and technology solutions to identify, monitor or mitigate climate risk.
"The increased likelihood and severity of extreme weather events means we can’t let our guard down," said Leon Gaber, National Lead for KPMG in Canada’s critical infrastructure resilience and emergency management practice.
"Whether disaster strikes in remote areas or in urban centres, companies and governments must continuously evaluate and update emergency planning and procedures to incorporate lessons learned and best practices.”
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
