2024 Global Risk Outlook Dominated by Environmental Concerns, Calls for Localized Action

Deforested area with group of trees still standing

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by | Jan 11, 2024

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The World Economic Forum’s 2024 Risk Report has revealed environmental issues as the dominant concern of risk analysts, with concerns pertaining to climate change and temperature rise topping the list of global risks for the coming decade.

For the report, risk analysts ranked global issues by level of severity, placing extreme weather events, critical change to Earth systems, biodiversity loss and ecosystem collapse, and natural resource shortages as the top four concerns for the next decade, with pollution also included in the top 10. The report explains that two-thirds of respondents ranked extreme weather as the top risk most likely to cause a material crisis this year.

Respondents, however, seemed to disagree about the urgency of environmental risks, with younger respondents ranking the risks of biodiversity loss and ecosystem collapse along with critical change to Earth systems far higher than older age groups.

Involuntary migration also arose as a top risk-related concern and an effect of climate-change-related collapse, pointing to the cascading effects of environmental deterioration throughout societal and economic systems.

Report Defines Consequences of Surpassing ‘Climate Tipping Point’

The second chapter of the report focuses on what the world may look like in 2034 based on current trajectories, expecting the world to surpass the Paris Agreement’s 1.5-degree Celsius limit by the early 2030s and leading to irreversible environmental damage. The report cites at least four major systems likely to tip at the 1.5-degree limit, such as low-latitude coral reefs and the Greenland and West Antarctic Ice Sheets.

Along with other world organizations, the World Economic Forum claims that current global climate change adaptations are falling short and many countries’ economies will be unable to withstand expected damages without outside financial support. Advanced economies will not be insulated from these effects either — the report finds that nearly 521,000 homes in Australia are predicted to be uninsurable by 2030 due to extreme weather risk.

The report also points to a number of climate modeling shortfalls, explaining that many models represent a linear pathway for the effects of climate change. The report instead suggests an evolved approach to climate risk management that fully considers longer-term, non-linear, precipitating impacts of Earth system changes.

WEF Calls Governments to Rethink Global Risk Action

Despite a definitively gloomy view of the coming decade, the report calls for global cooperation on building guardrails for major global risks and points to opportunities to take action to address expected environmental impacts. It also explores the potential for more localized action, encouraging individual and state resilience efforts and suggesting greater research on climate modeling and technologies that may accelerate the energy transition.

“The world is undergoing significant structural transformations with AI, climate change, geopolitical shifts, and demographic transitions,” said John Scott, head of sustainability risk for Zurich Insurance Group. “Ninety-one percent of risk experts surveyed express pessimism over the 10-year horizon. Known risks are intensifying and new risks are emerging – but they also provide opportunities. Collective and coordinated cross-border actions play their part, but localized strategies are critical for reducing the impact of global risks. The individual actions of citizens, countries, and companies can move the needle on global risk reduction, contributing to a brighter, safer world.”

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