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What is Climate Risk Management?
Sheshagiri Rao, part of IRI's research team, discusses climate risk management with farmers;
Srirangapur Village Knowledge Centre. (Haresh Bhojwani/IRI)
by Stephen Zebiak
As I wrote in the previous installment, climate risk management is a process that informs decision
making through the application of climate knowledge and information. IRI's approach to climate
risk management consists of four components. The first is identifying vulnerabilities and potential
opportunities posed by climate variability or change in a given part of the world and in a given
sector. For example, an extended drought or a delayed rainy season could have serious impacts on
farmers who grow rain-fed crops. On the other hand, there might be periods of above-normal
rainfall they could take advantage of, if they had access to information about the likelihood of when
and where those rains would occur.
The second component involves assessing the relevant climate risks. Relevance here is determined
by the problem at hand. For example, are wheat farmers in Ethiopia more concerned about the
predicted timing of the rainy season--how early or late it starts--or how much total rain is predicted
to fall? Perhaps instead they are most interested in the predicted total number of dry days or dry
spells. Using the best science and available data, we try to assess the range of possible future
conditions for whatever climate parameters are targeted. This typically involves gleaning
information from historical records, assessing the skill of climate forecast products and estimating
the uncertainties in monitored information. It also requires us to understand the nature of climate
variability at the different time scales defined by stakeholders. Farmers and health workers might
need information at seasonal to interannual scales--three months to a year ahead of time.
Development banks, foresters and dam builders may need decade-level outlooks; national
authorities negotiating in the United Nations Framework Convention on Climate Change may
require climate scenarios for the next 50-100 years. Each satisfies a set group of stakeholders, and
each comes with its own set of uncertainties and limitations.
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The third component is identifying technologies and practices that optimize results in normal or
favorable years as well as those that can reduce vulnerabilities during unfavorable years or during
extreme events such as droughts and floods. Farmers could decide whether to invest in fertilizers
and improved seeds or switch crops altogether, if they had access to seasonal forecasts and
understood how to interpret them. Forecasts could also help food-security agencies determine if,
when, and where to preposition food aid in anticipation of a crisis. Some crop failures may not be
avoidable, but every famine is. In the water sector, engineers using good quality decade-scale
climate information can optimize the design of dams. For existing reservoirs, they can use the
information to make better decisions on how to allocate the water, or better quantify the chances
that extremely low or extremely high reservoir levels will occur.
Once we've identified the best technologies and practices, the fourth and final step is finding the
"real world" arrangements that enable their implementation. Using the example of an early-warning
system for food crises, we can ask: What are the actual mechanisms to have in place for hunger
relief? Who are the key decision makers to identify? What specific types of climate information do
they need in order to take action and who will supply it? How do we make this sustainable?
The fact that climate risk management can be effective doesn't make it easy. Because the process is
inherently interdisciplinary, it requires a detailed understanding of complex, context-specific
interactions between physical, natural and social systems. It also involves collaboration among
experts who must work together on cross-disciplinary problems. Although developing the proper
strategies is a complicated task, climate risk management can be applied to agricultural, water,
health or any other sector, on spatial scales that range from local to global, and on time scales from
near- to long-term.
Communities are left exposed to a great deal of climate-related risk.
This happens despite the increased interest in climate, evidenced by
the resources invested in climate-related science, unprecedented
discussions on climate policy and increasing support for disaster-
risk reduction and climate-smart development.”
While the science of climate risk management is still in its infancy, strategies already exist for every
sector. For instance, an effort to address deepening drought in Western Australia created a
constructive engagement between water managers and climate scientists that improved practice in
both fields and contributed to better policy (see relevant links below). In the realm of public health,
a group of partners developed an integrated malaria epidemic early warning and response system
that is being implemented in conjunction with the Roll Back Malaria campaign. The system
includes seasonal forecasts, climate monitoring, vulnerability assessments, case surveillance and
response planning.
Similarly, an IRI project in the Southern Cone of South America manages agriculture related
climate risk through a series of technological and policy interventions. It also works to reduce the
uncertainty associated with the impacts of climate variability on agriculture. Our project partners
are currently developing information and decision support systems that include long-term climate
and agricultural impact information, continuous monitoring of climate and vegetation, and seasonal
climate forecasts.
We've also been involved on innovative weather-risk transfer solutions such as index insurance,
which provides a way to minimize the livelihood impacts of 'bad years' associated with extreme
events. This has the benefit of setting people free to invest in production during good years. In the
future, it may be possible to combine index insurance with climate forecast information, providing
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insurance against the uncertainty of the forecast. At the same time, drought index insurance allows
relief agencies to respond quickly as droughts unfold, thus avoiding catastrophes that may otherwise
destroy livelihoods and force farmers into poverty traps.
Obstacles to effective climate risk management
The practice of climate risk management as described above is rare throughout the world today.
Communities are therefore left exposed to a great deal of climate-related risk. This happens despite
the increased interest in climate, evidenced by the resources invested in climate-related science,
unprecedented discussions on climate policy and increasing support for disaster-risk reduction and
climate-smart development.
Very few development organizations use climate knowledge, information products, or related
management strategies as part of their overall toolkit. Practitioner communities in health, water,
agriculture, finance and other key sectors have not yet begun to incorporate climate risk
management into their day-to-day programs. Many climate service providers do not provide
information on scales that are relevant to policy and management decisions, or that can be easily
incorporated into their decision-making process.
A recent study by the IRI characterized the current situation as one of market atrophy--negligible
demand coupled with inadequate supply of climate services for development decisions. In this sense,
the main obstacle to the widespread implementation of climate risk management is the lack of
engagement and communication between communities, and the lack of investment to foster these
critical interactions. Climate researcher and service communities develop knowledge and related
information products from a disciplinary research perspective--often uninformed about stakeholder
needs. Meanwhile stakeholders in development, policy and planning are not capable of assimilating
relevant climate information that is available. As a result, research is not being taken up, while
stakeholders increasingly worry about climate but remain largely at a loss about what to do in
practice.
The solution to this dilemma requires a focus at the nexus of these communities. It also requires the
cooperation of relevant communities on global and local scales. The extent to which we can meet
this challenge will, in large measure, determine the benefit that can be realized from major ongoing
investments in research, observations, assessments, international policy and climate-sensitive
development programs in years to come.
In the next and final installment, I'll provide a path forward for the improvement and uptake of
climate risk management practices.
Stephen Zebiak is director-general of the International Research Institute for Climate and Society
at Columbia University, which uses a science-based approach to enhance society's ability to
understand, anticipate and manage climate risk to improve human welfare. He leads an
interdisciplinary team of more than 40 scientists specializing in climate prediction, agriculture,
health, water, economics and development policy. Dr. Zebiak has worked in the area of ocean-
atmosphere interaction and climate variability since completing his Ph.D. at the Massachusetts
Institute of Technology. He and Mark Cane authored the first dynamical model used to predict El
Niño successfully.
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Recommended Reading
The Influence of Climate Science on Water Management in Western Australia: Lessons for Climate
Scientists
Malaria Early Warning Systems - Concepts, Indicators and Partners - A Framework for Field
Research in Africa
Climate Change and Variability in the Expansion of Agricultural Frontier in the Southern Cone:
Technological and Policy Strategies to Reduce Vulnerabilities
Climate risk insurance: Prospects for poverty reduction and development
A Gap Analysis for the Implementation of the Global Climate Observing System Programme in
Africa
Climate Risk Management for Adaptation to Climate Variability and Change
Adaptation as "Climate-Smart" Development
A version of this essay appeared in "Climate Sense".
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About the IRI
The IRI works on the development and implementation of strategies to manage climate related risks
and opportunities. Building on a multidisciplinary core of expertise, IRI partners with research
institutions and local stakeholders to best understand needs, risks and possibilities. The IRI
supports sustainable development by bringing the best science to bear on managing climate risks in
sectors such as agriculture, food security, water resources, and health. By providing practical
advancements that enable better management of climate related risks and opportunities in the
present, we are creating solutions that will increase adaptability to long term climate change. The
IRI was established as a cooperative agreement between NOAA's Climate Program Office and
Columbia University. It is part of The Earth Institute at Columbia University, and is located at the
Lamont Campus.
Media contact: Francesco Fiondella
Telephone: 845.680.4476 or 845.680.4468