Four Twenty Seven’s monthly newsletter highlights recent developments in climate adaptation and resilience. This month, don’t miss our analysis of Japan’s recent flooding, a new report on economic climate risk in Australia, and context around other recent extreme weather events.
In Focus: Time and Tides – Flooding in Japan
Four Twenty Seven Analysis
Japan was the inundated by over 70 inches of rain in early July, resulting in significant loss of life and business disruptions. The clouds have since receded, leaving economic damage with long-term implications yet to be understood. However, estimates expect industry losses to be in the billions USD. Destruction was centered in Okayama and Hiroshima, driven by flooding and landslides. Japan’s floods were followed by a deadly heat wave, threatening those left without power after the storm and hindering recovery efforts.
Our latest analysis identifies companies affected by the event based on the location of vulnerable corporate facilities. We find several automobile manufacturers and electronic companies closed facilities during the flooding due to supply chain and labor disruptions. Understanding the ownership and operations of facilities in the damaged areas provides insight into what companies and industries may exhibit downturns in performance over the near term and be vulnerable to similar storms in the future.
Regulatory pressure and financial damage are necessitating an increase in physical climate risk disclosure in Australia. The nation’s predominant sectors are also the most exposed to drought and heat stress.
In exercising their own due diligence and assessing the exposure to physical climate risks in their portfolios, investors arm themselves with valuable information on corporate risk exposure which they can leverage to engage with companies around resilience.
Many areas around the world recently experienced their highest daytime temperatures and warmest lows. These records include Burlington, VT which had it’s warmest recorded low temperature of 80 degrees on July 2. Montreal had its highest recorded temperature of 97.9 degrees on July 2 when around 34 people died. Shannon Ireland set its all-time record of 89.6 degrees on June 28 and Quriyat Oman experienced the world’s warmest recorded low of 109 degrees on June 28.
Climate change threatens public health
Extreme heat threatens human health and economic productivity through impacts on the workforce, power grid and vulnerable populations. The Washington Post explains the connection between climate change and heat waves, and the social and economic challenges they bring. Strong and hot domes of high pressure have become more extreme as the climate warms, bringing heat waves. “While warm summer nights may seem less concerning than scorching afternoons” warmer nighttime lows are dangerous because the body has no respite, the New York Times reports.
Join the Four Twenty Seven team in the field at these upcoming events:
July 18:Summer in the City CRS Investing Summit, New York, NY: Macroeconomic Risk Senior Analyst, Lindsay Ross, will speak on a panel about assessing physical climate risk in investment portfolios at this annual convening of the responsible investment community.
August 28-29:3rd California Adaptation Forum, Sacramento, CA: Join Yoon Kim, Nik Steinberg, Kendall Starkman, Josh Turner, and Natalie Ambrosio at this biennial convening of adaptation professionals. Yoon will moderate a panel on the legal aspects of adaptation finance, Kendall will facilitate a panel on mobilizing climate adaptation through partnerships and Nik will present the California Heat Assessment Tool.
September 11:Building Transformational Community and Economic Resilience: San Francisco, CA: Four Twenty Seven will host a side event alongside the Global Climate Action Summit on Sept 11 to discuss the role of investors, businesses and governments in building climate resilience, both in California and abroad. Invite only.
September 12-14:PRI in Person, San Francisco, CA: Visit the Four Twenty Seven booth and meet with our team at this annual gathering of responsible investment industry leaders.
September 12-14: Global Climate Action Summit, San Francisco, CA: Join the Four Twenty Seven team at this convening of global climate adaptation experts meant to propel action around the Paris Agreement.