Climate change risk: the risk below the radar.
As a professional in the area of Governance, Risks and Compliance, I often mention, in related articles, various risks that exist in different sectors of the economy, including the beverage segment.
Among the risks, I mention, for example, losses
in volume and market share, losses due to price, competitor actions, breakdown
of machines and equipment, tax and fiscal risks, environmental, health and
safety risks, human contamination, damage to the image and reputation, IT and
Cyber. These are the most evident and common in companies. However, there is a
risk that has increasingly stood out and that was previously not on
organizations' radar: the risk of climate change.
Southern Brazil is an area of critical
climate convergence. In that environment, the Antarctic cold meets the heat of
the Midwest, plus ocean winds causing atmospheric pressure and sudden
extratropical cyclones, typhoons, gales and, consequently, damage and loss of
property and lives are impacted. To make matters worse, the abrupt change in
climate causes heavy rains and floods. In this sense, a series of disasters,
when analyzed together, become a true catastrophe. It's a total disaster.
Highways are closed, the supply of drinking water is cut off, electricity is
interrupted, and the supply becomes limited or even scarce. The government is
not up to the task, even with the best crisis & contingency plan in hand. Humanitarian
aid becomes essential. After all, we live in a community. (This scenario is
very similar in the Florida region. Officially the hurricane season in Florida
is from June to November. The latest records show that the most impacted months
are August, September and October. These are the months with the highest
probability of formation of storms and hurricanes.)
After reading the CNN news, more than 154
cities were affected due to heavy rains in Rio Grande do Sul. Knowing that this
Southern State is one of the largest producers of craft beer, considering the
number of manufacturers, these are certainly being impacted in some way. For
example, the brewery Blaut Beer, from Farroupilha-RS, announced on its
Instagram channel the momentary interruption of pre-May 1st holiday (Labor Day)
activities due to heavy rain. I do believe that other breweries did the same.
The observations above lead to a path: do a
benchmarking, put the topic on the agenda of the meeting of partners and
shareholders, build your risk map considering climate risks (also include
severe droughts.) Create mechanisms to mitigate physical and digital risks and,
above all, consider including the assessment of this risk by the broker when
purchasing an insurance policy to mitigate the impacts, sharing the risk with a
first-rate insurer.
I wish my friends in the brewing chain
(farmers, logistics companies, suppliers) and brewers in Rio Grande do Sul luck
and a quick recovery in their operations, including partners, customers and
employees. I sympathize.
References:
https://www.cnnbrasil.com.br/nacional/chuvas-no-rs-governo-confirma-29-mortes-e-60-desaparecidos/
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