⚠️This is the first operational version of the handbook, but it is still a work in progress and will be heavily updated during 2024!⚠️

Connect CLIMAAX with Climate Risk Management

Connect CLIMAAX with Climate Risk Management#

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At the local level, Climate Risk Management (CRM) addresses the unique challenges that the changing climate is bringing to the region. It focuses on developing and implementing strategies that anticipate, prevent, and prepare for climate risks, as well as enhancing the ability of natural and human systems to adapt, withstand, respond and recover from climate-related shocks and stresses.

The assessment of Key Climate Risks, as part of Key Risk Assessment, is foundational to inform CRM decisions. Key Risk Assessment helps to prioritize climate risks based on their potential impact, the immediacy with which they need to be addressed, the local adaptive capacity and readiness to respond to these risks, and the risk perception of the public and key stakeholders. While CRM decisions must be informed by the CRA, risk perception also plays a crucial role in influencing public support for CRM and adaptation strategies. Therefore, the robust scientific evidence generated through quantitative risk estimation - ideally combined with qualitative, participatory approaches - must be used to inform and raise awareness among relevant stakeholders and key local actors, too. This not only facilitates initiating adequate CRM actions but also ensures public buy-in and alignment with local priorities and needs.

The climate risk profile of a region, including its projected changes over time, is the primary indicator of “what”, “where” and “how” CRM and adaptation responses should be initiated. However, there are additional entry points for CRM. Previous risk management interventions and ongoing adaptation processes in place can reveal valuable opportunities for introducing additional, complementary measures or even maladaptation. Moreover, CRM and adaptation responses undertaken in other areas can offer insights into what could be applicable and how to design and implement it for the region’s particular situation. T

CRM is a comprehensive process involving various iterative and dynamic steps (GIZ, 2021; UNDRR, 2022). In the context of the EU Mission on Adaptation to Climate Change, CRM and adaptation planning are further addressed by the Pathways-to-Resilience (P2R) programme — a project complementing CLIMAAX. Figure X presents a simplified view of an approach to CRM, consisting of four major steps:

  • Identifying potential adaptation options that can either reduce the vulnerability of climate impacts or enhance its resilience. This step involves detailing all possible actions, approaches, and strategies that could be taken to manage identified climate risks. These could include structural, technological, nature-based, community-based, institutional, behavioural, financial, and informational interventions. In this step, stakeholder engagement is fundamental to ensure that the options are viable and aligned with the needs and capacities of the affected communities.

  • Prioritizing adaptation options based on criteria such as cost-effectiveness, feasibility, impact, and stakeholder preferences. This step involves a detailed analysis to assess the benefits and drawbacks of each adaptation option, considering both short-term and long-term implications. Prioritization helps in allocating limited resources to the most effective and efficient CRM strategies and adaptation responses. It may also consider other aspects, such as implementation readiness and immediate performance, based on the level of urgency identified in the Key Risk Assessment.

  • Securing funding consists of identifying potential sources of finance for the prioritized CRM and adaptation measures, which could include government budgets, international climate funds, private-sector investments, or public-private partnerships. The process also entails ensuring that the financial mechanisms are in place to support the implementation of chosen options and the intervention’s long-term financial sustainability. This is of particular relevance given that effective and secured funding strategies allow for turning planned adaptation projects into actionable responses.

  • Implementing the chosen CRM and adaptation responses. This involves not only executing and managing the interventions but also continuously coordinating various stakeholders, such as government agencies, local communities, and private entities, to ensure successful implementation. It also requires integrating and aligning the CRM and adaptation responses into local development planning and regional policies. Importantly, the implementation of the responses should be regularly monitored and evaluated to assess the effectiveness and progress of building resilience to the targeted climate risk. This allows for adjustments and improvements over time, ensuring that the CRM endeavours deliver the expected outcomes adequately and timely and preventing interventions from inducing maladaptation.

In CRM, defining risk ownership is essential and therefore connects back to the Climate Risk Assessment Scoping step. it is crucial for ensuring that risks are not only recognized but also actively managed through tailored risk mitigation and adaptation strategies. Moreover, it enables stakeholders to understand their specific duties and how they contribute to the broader CRM objectives, as well as fostering resource mobilization, effective resilience-building against key climate risks, and proactive adaptation to future climate conditions.

Utilizing a SMART (Specific, Measurable, Achievable, Relevant, and Time-bound) approach to track the implementation and performance of CRM and adaptation responses supports the monitoring and evaluating climate risks. On the one hand, establishing specific, measurable, and relevant metrics of the effectiveness of CRM and adaptation actions allows for targeted data collection directly connecting to critical areas of the specific identified risk. On the other hand, achievable and time-bound CRM interventions allow for tracking progress in reducing vulnerability and enhancing local adaptative capacity. Adopting this reporting approach is helpful for CRA, considering that an objective evaluation of the CRM effectiveness in reducing identified risks and improving resilience can indicate those unattended areas or drivers that would need to be further addressed through other actions, as well as revealing segments of residual risks. Therefore, the systematic tracking and reporting process is essential not only for transparent communication or for updating risk management plans but also for informing new cycles of CRA and the need to analyze additional facets of climate risks.