Can we go from 'sleepwalking into catastrophe' to waking up to catastrophe?

On the VERGE

Can we go from 'sleepwalking into catastrophe' to waking up to catastrophe?

world in an alarm clock
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This was adapted from the newsletter VERGE Weekly, running Wednesdays.

"Of all risks, it is in relation to the environment that the world is most clearly sleepwalking into catastrophe," warn the authors of the World Economic Forum’s 2019 Global Risks Report.

The "sleepwalking into catastrophe" part is what struck me most — a seemingly paradoxical phrase in the context of the global challenges we know we face. If our proverbial eyes are open enough to see the impending catastrophe, what’s keeping us from waking up to reality?

I was inspired to revisit the Global Risks Report this week, in part by two disparate but related pieces of news about risk and resilience that have sparked in me some serious cognitive dissonance.

First, RIP 100 Resilient Cities: For those of you who have been tracking the Rockefeller Foundation’s 100 Resilient Cities Initiative (100 RC) over the last six years, last week’s somewhat unceremonial announcement that it’s closing its doors in July came as a surprise.

What quickly became the global darling of city resilience initiatives, 100 RC made promising progress in a short period of time towards its goal of helping cities around the world become more resilient to the physical, social and economic challenges of the 21st century. Since 100 RC’s launch in 2013, it supported member cities in hiring more than 80 chief resilience officers to develop Resilience Strategies, building a robust global network of public, private and NGO partners to grow the urban resilience movement globally. According to 100 RC, more than $3.35 billion was leveraged to-date to implement over 2,600 initiatives that are already making cities more livable, sustainable and resilient.

Things seemed to be going well, which is why the news was a shocker for many. Beyond the official update made by 100 RC President Michael Berkowitz, and other mainstream yet vague coverage about the Rockefeller Foundation’s new plans to continue supporting city resilience projects in smaller, more piecemeal ways, we don’t know much yet about why it’s shutting down.

Meanwhile, and ironically, the challenges 100 Resilient Cities was designed to address are among those listed in the Global Risk Report’s Top 10 list of risks by likelihood. The top three are extreme weather events such as hurricanes, floods and wildfires; failure to mitigate and adapt to a changing climate; and major natural disasters, such as earthquakes, tsunamis and volcanic eruptions.

Another report, this one released last week by investment giant BlackRock, provided a different kind of urgent warning that it’s time to take climate risks seriously. It outlines the ways in which investors are vastly underestimating the material risks posed by climate change — not just in the future, but today.

With more than $6 trillion of assets under management, it’s safe to say that BlackRock has a vested interest in understanding and quantifying the risks associated with climate change and the transition to a low-carbon economy. According to Brian Deese, global head of sustainable investing at BlackRock and President Barack Obama’s former climate advisor, the analysis is a "breakthrough" in leveraging technological advances to bring together detailed local asset information alongside updated climate models and big data.

Their initial findings suggest that many U.S. markets — particularly electric utilities, commercial real estate and financial services, in particular municipal bonds — are consistently underpricing the physical risks climate change poses to their companies and investments.

Such risks are notoriously hard for investors to grasp for several reasons: For example, there are many incorrect perceptions that climate impacts are slow-moving and difficult to model. But, as GreenBiz contributor Liz Enochs noted last month on the push to mainstream investments in adaptation and resilience, it’s difficult to quantify the benefits that resilience investments deliver. Moreover, there’s the enduring tension by corporate boards and their investors between short-term returns and the need to take the long view. Investors’ dominant interests in quick returns simply don’t align with, and ultimately won’t yield, the kind of environmental, social and financial dividends that adaptation and resilience projects can deliver by embracing longer time horizons, noted Enochs.

So here we are, sleepwalking into catastrophe, eyes wide open. It brings up an essential question: How do we prepare for that which is anticipated but unprecedented? How should you and your organization gear up for what Peter Schwartz calls the inevitable surprises that lie ahead? At this point, there may be more questions than answers — but asking them, thoughtfully and strategically, is a good place to start.

I leave you with a short story that encapsulates the challenge inherent in planning for the inevitable:

Shoshana Zuboff, in her new book "The Age of Surveillance Capitalism," recounts the experience of her home being hit by lightning. House on fire, she ran upstairs to close bedroom doors to protect them from smoke. With her arms full of family photo albums, she dashed to the front porch for safety, where the fire marshal got to her just moments before her home exploded in flames.

"In the early phase of crisis, I could imagine our home scarred by smoke damage, but could not imagine its disappearance," she recounted in her book. "I was blind to the conditions that were unprecedented in my experience."

Zuboff’s point, of course, is that the unprecedented is hard to envision, and that we humans interpret potential future calamities through the lens of what’s familiar.

As we enter into an era defined by unprecedented experiences, may we see clearly and work strategically before our planetary home becomes too hot to handle.