3 How will climate change affect business location, real estate and infrastructure?

Many businesses are directly affected by weather e.g. agriculture, leisure and tourism and so will be affected by climate change. However, businesses that are dependent on long-term investment are likely to have larger impacts, because the consequences of climate change increase over time. So the industries of construction, real estate, transport and infrastructure are likely to be the most effected by climate change impacts.

Depending on the location and microclimate, buildings can be affected by flood, wildfires and landslides. Older buildings, especially near the coast and waterways are vulnerable to flooding and storms. This could affect the value of building and real estate and make it more difficult to obtain adequate insurance. In turn this could promote changes in government regulations and purchasing trends. It could also result in increased building costs, with new standards and preventative measures. As a result it is the newer houses which will be able to withstand a changing climate more easily.

With increasing requirements, building codes, tax and other incentives for energy-efficient buildings, there is a move toward more compact developments and an increase in the value and desirability of ‘green buildings’. These opportunities in energy efficiency and new construction technologies may also result in carbon reductions that could produce market-valued offsets for other business sectors.

Business location will also be affected by the real estate issues above. Climate change will affect almost all forms of infrastructure: electricity, gas, and water in the utilities as well as transport access and telecommunications. This in turn will affect people. Electricity could suffer from interruptions and blackout from extreme weather events. The lack of capacity may also be a factor due to increased demand under extremes of temperature. Drought could reduce water supplies and hydroelectric generation. Any low-lying buildings, airports, rail lines and roads, are vulnerable to floods and storms. Roads and rails will need to be resealed more often due to the heat.

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2.2 What‘s the role of corporate social responsibility (CSR)?

4 How will climate change affect business travel?