To add to the laundry list of reasons why 2020 was a bad year: estimates from NASA indicate that 2020 was tied with 2016 as the world’s hottest year. Record-setting temperatures and extreme weather events have become the norm in the era of climate change. The average global temperature last year was 1.2 degrees Celsius above the pre-industrial era, meaning 2020 has brought the world closer than ever before to the 1.5 degree turning point that climate scientists claim will cause irreversible damage to ecosystems, renewable energy sources, urban planning capacities, and infrastructure systems. 2020’s extreme temperatures can be interpreted as a call to action; the last 7 years were the warmest in history.
The pattern of record-setting temperatures throughout the past decade is more troubling than the fact that 2020 was Earth’s hottest year. Factors that vary year-to-year can impact global warming in the short-term, indicating the importance of monitoring trends over time. One significant factor in 2020 was reduced pollution caused by travel restrictions due to the COVID-19 pandemic. Since the atmosphere contained less particulate matter, more sunlight reached the Earth’s surface and increased global temperatures. While this year’s anomaly in pollution levels contributed to high average temperatures, the consistent pattern of global warming detected by scientists throughout the past decade is the most troubling aspect of the data.
For the corporate sphere, these trends signify that the costs of integrating climate sensitive practices into business models will quickly be outweighed by long-term benefits. Climate change results in both risks and opportunities for businesses, creating space for individual companies to find the most viable solutions for their models. Business risks that result directly from climate change include rapidly depleting energy sources, increases in severe weather events, and stricter regulations, while opportunities may arise from new or recently popularized markets and heightened interest in low-carbon technologies or services.
2020’s extreme weather events and record-breaking temperatures show one data point in an overall trend which will eventually impact every business in all sectors. Zero waste and zero net emission companies dominated investment inflows over the last year, proving that integrating climate sensitive practices into business models will increase bottom lines. As demand for clean energy and socially conscious business practices skyrockets, companies stand to achieve a sustainable competitive advantage from incorporating environmentally friendly choices while becoming a part of the solution to climate change.