Passing the Buck: The Soaring Costs of Climate Change

Deadly fires raging on the west coast. The influx of hurricanes and once-in-a-lifetime weather events that seem to happen more frequently than ever before. The reality is extreme weather is tied to the soaring costs of climate change. Global CO2 emissions have increased by nearly 50% since 1990, and 2019 was the warmest year on record. For the 1st time, the World Economic Forum has named climate change as a leading risk facing business and our survival.

Climate change impacts natural and human systems globally. As the Earth's average surface temperature rises, so do extreme weather events, changing precipitation patterns, rising sea levels and ocean acidification. These risks will ultimately impact people’s livelihoods, particularly marginalized groups such as women, children, and the elderly, as resources, food and water become more scarce. If you think about climate change through the lens of the Sustainable Development Goals, the lasting effects of climate change makes it very difficult to achieve over 80% of the SDG's 169 goal targets.

According to, the price tag for solving climate change in the US is $140B per year. It may sound like a lot, but it’s less than 0.2% of global GDP. The 2019 Defense Budget in the US was $716B. The cost will only increase the longer we take to act ambitiously. The social costs of carbon are even more eye-opening.

In a study on climate change, with 8,000 companies reporting on climate risk, 72% of respondents said that climate change was a source of risks that significantly affected their operations, profits or costs. The "externalized" costs of our current linear economic model are now being realized. In Episode 25 of the Supply Chain Revolution podcast with Tom Raftery of SAP Digital, we explore climate change and the green revolution. The discussion touches on everything from SDG 13, to a comparison of renewable energy sources, how to build a green data center, why Google and Microsoft cloud environments are more sustainable than AWS, and the business case for transition to EVs (electric vehicles). What is the social cost of carbon? How can reporting and pricing carbon can reduce emissions and enable smarter planning in supply chains?

Supply Chains, technology, and Industry 4.0 are a conduit for climate action using environmental risk management, the cost of carbon, and understanding consumer behavior where shifts like purchaser-to-participant and “shades of green” meet the consumer in their green journey. There are natural climate pivots like the “flexitarian diet” and small behavior shifts that pay dividends. There is a fiscal argument for climate action that is unpacked in this episode, including more on SAP’s new Climate 21 initiative.

The green revolution starts with you. Learn more about how we can design a better future with zero waste, equality, and transition to carbon neutrality, and carbon negative solutions to unite people and our planet.

Listen to this episode and learn more ~>

#sustainability #supplychain #climatechange

About The Author

Sheri R. Hinish
Sheri R. Hinish
SupplyChainQueen ® | Executive Advisor and Change Leader | IBM Executive | Passionate about Supply Chain, Sustainability, Innovation, and Inclusive Leadership|

To read more about Sheri R. Hinish, check out her full bio here.