Climate change, Canada and what we should do next
For more than a decade, climate change has been a leading global topic. There is hardly a conference or a summit without a sustainability-related topic on the agenda. And rightfully so - with glaciers shrinking, weather patterns changing, and sea levels rising, we have moved from simply acknowledging the problem to desperately looking for solutions that could help mitigate climate risk. A growing number of global leaders and organizations have stressed the importance of sustainable business practices and pledged to transition to the zero-carbon operation in the near future.
But what does that mean for Canada specifically? According to the latest sigma report from the Swiss Re Institute, 2019 has been the second warmest year of the decade. The annual average temperature in Canada has increased by 1.7°C since 1948, roughly double the global average but with strong regional variations. The increase has been greatest in the Arctic region, and considerably higher in the winter, particularly in British Columbia, Alberta, Yukon, Northwest Territories, and western Nunavut. In addition, warm events are becoming more intense and more frequent, and cold events less intense and less frequent.
1.7°C may seem like a nominal fluctuation that many of us probably would not notice on a given day. However, it is a significant spike in our planet's recent history. Small changes in temperature correspond to enormous changes in the environment, often resulting in frequent heavy rainfall and flooding, and, at the same time, a higher likelihood of wildfires. With each degree of increase, those extreme weather events that used to be rare and isolated become more frequent, concurrent and intense. We have also seen a spike in secondary perils following major nat cat events. Torrential rainfalls, storm surges and mudslides have become more frequent after coastal hurricanes, affecting larger territories and causing additional losses for businesses and communities.
I am proud to say that the Swiss Re Group has been the industry leader in sustainability for decades, first recognizing the impact of climate change more than 40 years ago, in 1979. Since then, we have outlined those risks in our sigma publications and highlighted our solutions to those risks in our annual reports. I have always seen our ability to zero in on a societal issue and come up with tangible solutions as our key strength.
Today, at Swiss Re Corporate Solutions, as we address our customers' unique risk transfer needs, we also help them achieve their own sustainability risk management goals. Those efforts include helping procure a more environmentally-conscious supply chain, making solar power more accessible throughout their communities, and enabling a smoother, faster recovery from earthquakes and hurricanes with our innovative parametric solutions.
For example, here in Canada, we have been providing a long-standing aggregate stop-loss solution for a major utility customer, helping them balance their own risk retention with the added resilience of insuring them from frequency of significant losses. I am proud of our team for putting together such an innovative policy that benefitted not just our immediate customer, but a larger community in that region.
Finally, as we move through 2020 amidst a global pandemic that has disrupted our daily lives, we are all learning to make small sacrifices for the greater benefit of our society. I truly believe these lessons will prove useful far beyond our current situation. We've become more mindful of one another and of everything around us. We notice that small collective actions bring about infinite changes, proving that together the Canadian business community can do its part to advance sustainable business practices, focus on renewable energy sources, transition to a zero-carbon economy, and help mitigate climate risk for years and generations to come.