Hello everybody and welcome to another edition of C&F Talks, the series in which I get to interview some of the speakers at our forthcoming events. Today, it's my pleasure to be interviewing Sarah Winne, the Associate Technical Director, Climate Risk and Adaptation at Arcadis. Sarah is going to be joining us to speak at our Managing Physical Climate Risk Summit on the 10th of March in London. Sarah, welcome.

Thanks very much for having me and yeah, really looking forward to the event.

Absolutely, pleasure to have you with us.

Given the increasing severity of physical climate risk, how should financial institutions and corporates embed climate adaptation into their long-term business strategies?

It's a really good question and I think the first step, which might be a bit basic, is to actually have a business strategy which addresses adaptation. So, I think a lot of organisations I've worked with sometimes think that just doing a physical climate risk assessment is the same as doing a scenario analysis and they see it as a little bit of a tick box exercise. So, I think what is really important to remember, is that you're actually supposed to stress test your business's strategy to the impacts of climate change.

So actually making sure that you have adaptation within your strategy, that you have metrics, that you have targets that are specific to climate adaptation, is actually really important and it's something that's missing. I think we're quite good in most organisations at having very clear decarbonisation targets, but adaptation often is sort of a distant second. So, I think making sure that you have really clear KPIs, what are you trying to achieve for adaptation, what's the vision, what's the plan, is actually a really important first step that's often overlooked.

So, I think if a lot more businesses actually specified it really clearly, that would be a really big step forward so that they could then make a plan for how to actually address it, where their priorities are and so forth.

So, what you're saying they should get to it at the start of the process of developing the strategy and test it. I think that's clearly very, very good advice.

I mean, Arcadis emphasises data-driven solutions. How can organisations leverage data and digital innovation as well, to assess and mitigate climate risk more effectively?

I mean this is a such an important area and I think a lot of us kind of climate practitioners are starting to realise the power of data and I think it's especially important for the financial sector because they often have such diverse portfolios that span massive geographic areas. So, I think, you know, the first sort of data that needs to be leveraged is climate data, climate projections and there's different ways of doing that. So, I think, at Arcadis we tend to use national level projections where that's appropriate, but we've also been leveraging sort of, best practice, you know, best-in-class climate data.

We have a partner with Jupiter Intelligence to drive our climate nexus platform which allows climate data to be evaluated across wider geographies which is really important so that organisations can have that vision of where the most important climate risks are across their large portfolio so they can prioritise funding, they can prioritise adaptation activities. So it's a really challenging topic when you have you know just trying to figure out everyone has a limited budget, where do you prioritise your adaptation activities? So being able to leverage climate data is really important and it is a really complex topic so being able to use digital solutions to visualise those risks and communicate them to perhaps non-technical stakeholders is also really useful.

I think another area of data that we're starting to get into in my work, is looking at how organisations should collect data on the costs and benefits of adaptation measures alongside the costs and benefits of decarbonisation measures. So, we've done some really interesting work using digital solutions that really help to explain to clients, you know, okay these are the different costs, these are the benefits, these are the areas where you can probably get the most bang for your buck as it were. So, I think being able to communicate a joined-up approach to adaptation and mitigation is really helpful and it helps to, you know, to make the business case which is really challenging, you know, when budgets are limited and there's a lot of conflicting priorities.

So I think basically being able to collect data and then use digital solutions that reflect all the different adaptation measures that might be appropriate, what the payback period is, trying to understand those costs and benefits is something that we're finding a lot more organisations are asking for and again it is a lot more challenging with adaptation because with decarbonisation it's a bit more tried and tested. People know, okay a solar panel costs this amount; it's going to save this amount but for adaptation, we're kind of slowly getting to grips with how we can do that better.

Maurice

Presumably it's quite hard to have granular data though, is that, I mean, you talk about, what level can you go down to when you're looking at data, if somebody has a specific interest in a specific part of the country, what are the limits on that?

I mean, it's I'm pretty sure that we go down to sort of five square meters so really granular. I think it's important to know how to analyse that, so I won't pretend that if you stand here the climate's going to be completely different than if I move over five metres but it's about downscaling those global climate models and doing it in the right way. Which is why we it's really important to kind of have the experts because it can you know I do find with climate data it is very easy to misinterpret it, so it's about being able to communicate that uncertainty and also looking across a range of scenarios, so we don't know exactly what emissions levels to prepare for and what effects those will have on the climate system.

So being able to say okay yes this is a quite a granular analysis but there is uncertainty there and this is the sort of range of possibilities and to build that uncertainty into your business planning.

Maurice

Yeah, so just picking on that last point, what are the biggest barriers for organisations as they implement their climate adaptation measures, and how can they turn those into-from challenges into opportunities do you think?

I think, yeah that's a good question. I think, it's probably, it comes down to money. It's being able to demonstrate that cost benefit and that goes back to my earlier point you know I think people are organisations are quite happy to say okay well I've you know implemented this decarbonisation measure and I can see very clearly what amounts of carbon it has saved my organisation how it helps to achieve our net zero targets. But being able to say the same thing about adaptation is a lot harder. Especially when you're looking across the range of climate hazards, I think in the UK that is probably another barrier, we're very good at looking at understanding flood risk and planning for flood risk but some of the other hazards are not well understood. So I'd say that's also, just we need to learn from other countries that are dealing with hazards such as overheating, wildfires, drought on a more regular basis than we have in the UK, and being able to learn from you know their mistakes as it were and learn from best practice.

But I think being able to demonstrate the cost benefit is something that's hugely important, and I think that the two ways that I think we need to tackle that challenge is to make sure there's some kind of mechanism in place to collect the data that demonstrates the effectiveness of how adaptation measures are implemented so being able to record, say okay it cost me this much, but the labour cost was this much but I found these efficiencies by, you know, doubling up with some refurbishment that was needed anyway. So really just having a way, whether that's through, you know, sort of you know maybe even collecting it through you know existing data management systems within an organisation, adding in that ability to track and monitor those adaptation measures will really help to demonstrate the cost benefit of adaptation.

And to also identify co-benefits I think that's another really important area, so not just with adaptation and decarbonisation but also trying to identify opportunities, you know, okay we're building resilience to climate change but we're also enhancing biodiversity. It's a hugely important area that I think we're just starting to understand and identifying those sort of nature positive solutions.

Also identifying opportunities to improve you know social value, well-being, health I think we there's some really cool examples around the country of projects that are, sort of, doing it all they're just, you know, creating a great place for where people want to be they're helping to improve resilience maybe reduce flood risk through nature-based solutions so I think we need to just do a lot more of that.

Yeah, those co-benefits are very important, aren't they?

I guess one area of focus for you must be critical national infrastructure, how is Arcadis helping the infrastructure sector future-proof itself, if you will, against climate extremes such as flooding, heat waves and rising sea levels?

I mean, I think infrastructure is one of those areas where I'm perpetually so happy that Arcadis has really good experts that I can speak to. So I think with infrastructure in particular it's, you need to understand the specific infrastructure, you know, energy infrastructure is so different from water utilities and you know waste infrastructure, it's such a diverse area. And I get really excited about it actually because I think I have secret desires to be an engineer, but you know maybe in a different life, but it's so interesting to actually understand the sort of sensitivities of the different infrastructure, the interdependencies are really challenging as well, because obviously it's all physically connected and all dependent on other infrastructure to keep going.

So, I think being able so, at Arcadis, I think we're large enough we have all that expertise you need an expert in the infrastructure type you need someone who understands what makes the client tick, we have those really long-term relationships with some of those infrastructure operators and you also need, so for example I often call on my friendly neighbourhood geologist to help me understand, you know, some of the soil hazards that might be relevant to a particular location, the flood risk experts, so it's not just about me as a climate change practitioner, you know, coming in and doing an assessment and telling them what they need to do about overheating, it's about being able to draw on that really interdisciplinary team, so that I can make sure as well that, you know, a recommendation that might tackle one hazard isn't going to have a, you know, create a problem for a different hazard or a different part of the infrastructure so yeah I'm always, always really happy to take an interdisciplinary approach when it comes to infrastructure.

Fantastic, very interesting conversation, Sarah. So, for our viewers very much hope you'll be able to join us to hear more about this and related issues at the Managing Physical Climate Risk Summit in London on the 10th of March. Further information is available on our website www.cityandfinancial.com.

Just remains for me to say, thank you very much, Sarah, look forward to seeing you in, what, a couple weeks’ time.

My pleasure, thanks very much.