Working with the private sector to cope with our warming world
Flood damage in a home in Piura, Peru
This week marked the release of the latest report from the United Nations Intergovernmental Panel on Climate Change (IPCC).
The 1.5 °C Special Report confirmed that that more and more people, especially the most vulnerable and marginalised, are going to be effected by increasingly severe disasters, particularly flooding, drought and extreme temperature events.
The impacts are already being felt. 2018 was one of the hottest years on record and one of the most expensive in terms of economic losses from disasters, it is estimated that flooding alone cause $2.1billion worth of damage (EM-DAT).
Helping to reduce these economic losses for the poorest and most vulnerable people is a priority for Practical Action. They are already facing the irreversible consequences of climate change including homes lost to rising seas, livelihoods lost to drought and floods, and lives already lost to heatwaves and unseasonal wildfires.
If people cannot protect themselves from disasters, then they cannot break out of the cycle of poverty that traps them.
How could the private sector help?
Increasingly, attention is turning to the private sector to help reduce economic losses, particularly through the use of insurance.
But, it’s not enough to just protect what people already have – especially in developing countries – where many people cannot even afford insurance without increasing their livelihoods and income first. There needs to be investment in the future and we need to look at alternative ways to make communities more resilient to disasters. The private sector can help to do this.
Here are some examples of how Practical Action has helped communities cope with disasters by working with the private sector:
Working with global companies +Floods affect more people globally than any other type of disaster event, so in 2013 Zurich Insurance chose to use their risk expertise as a global insurer to help communities prepare for flooding. The Zurich Flood Resilience Alliance brings together the strengths of research institutions and NGOs (including Practical Action) with the power of the private sector: particularly Zurich’s expertise in predicting, assessing and learning from flood events. Read More
Working with small-holder farmers +Even the smallest actors in the private sector can help people become more resilient in the face of disasters. In Nepal, Practical Action has been working with farmers to make their income less vulnerable to climate change and disaster events by growing more flood resistant crops, changing how they store produce and exploring alternative ways to earn money without their fields during floods. Read More
Working with private sector experts +Early Warning Systems (EWS) are essential for people to avoid losses. Having worked with communities and governments to develop effective and appropriate EWS for many years, Practical Action has found that private sector expertise is always critical. This is true regardless of the scale of the system, whether community-owned or government-run. Read More
A bamboo bridge in Peru allows safe evacuation from flooded areas
More than just insurance
The private sector clearly has an important role to play in helping people cope with disasters and reduce the losses they suffer. But while most of the conversations going on at the moment are about insurance, Practical Action’s experience shows that there is more to consider.
As we’ve seen, from small-holder farmers to telecoms companies, reducing economic losses will need the involvement of more than just insurers. Focus and investment needs to be cast wider, and the private sector has an important role to play as we work to ensure that we leave no one behind.