Climate change scenarios were once terms used only in scientific publications. Today, however, they are ubiquitous in sustainability discussions across various industries, from investors to energy and food & beverage sectors. Consider any product in your home, from an Apple phone to your Ben & Jerry's ice cream; the companies use some climate scenarios for risk management.
Just last week, the US Fed released results from its pilot climate scenario assessment which involved six of the biggest banks in the US, Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley, and Wells Fargo. The result from this exercise estimated that, would be impacted in the scenario of a hurricane event in the US Northeast.
These scenarios in the AR 6 were tested on complex models to understand the impact these potential storylines could have on reducing emissions. IPCC uses the results of a suite of models rather than the results from just one model; this gives robustness to its results. The approach of using results from multiple models is enabled through an exercise called model comparison.
Businesses that use climate scenarios in their sustainability disclosures include a risk and opportunities assessment under different global warming scenarios in the future.
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