Building Resilience to Climate Risks

MENA is one of the most vulnerable regions to climate change. Already, many countries within the region are experiencing the harsh realities of our changing planet. Our people are living with climate extremes, enduring extremely high temperatures, desertification, water scarcity, degraded marine and coastal ecosystems, and extreme weather events. Recently in the UAE, known for its very hot and dry desert conditions, we experienced the impacts of heavy rainfall and extreme flash floods, with Fujairah receiving more than double the UAE’s typical annual rainfall in less than a week. The flooding blocked roads, damaged vehicles, and prevented people from getting food and water. It was shocking to hear these stories from my Majid Al Futtaim colleagues and how severely impacted our wider community has been. We must acknowledge the climate crisis is already affecting our day to day lives.

?The increased intensity and frequency of these events is now widely accepted to be linked to the climate crisis, and in this case, changes in the Asian monsoon cycle. Not only is MENA threatened by physical climate risks, but our region’s dependency on fossil fuels, low energy efficiency and limited uptake of renewable energy is cultivating considerable economic and transition risks as well. The importance of addressing the climate risks we are already facing is undeniable.

?Cities form a central part of any adaptation plan. We live in a highly urbanised region, where cities represent the epicentre of a host of economic, social and environmental stresses and infrastructure acts as our place of refuge from climate-induced events. As a result, it is vital that we identify the most material climate risks that we are facing now and, in the future, to inform strategies for building climate resilience. Whilst everyone can do their part to help tackle the climate crisis, government and key industry players must take the greatest responsibility.

?Majid Al Futtaim gladly accepts the role it can play to build climate resilience and accelerate the transition. By performing a comprehensive climate risk assessment spanning the entire scope of our business and our real estate portfolio, we identified the top climate risks we face in the near and longer-term. Our top physical climate risks include extreme weather, water stress and drought, temperature extremes, supply chain disruption, and coastal flooding. Meanwhile, our top transition climate risks – namely the risks we incur if we do not respond to climate policies and investments – include tightening building standards, biodiversity requirements, the fossil-fuel phase-out, and insurance-related challenges.

?To proactively tackle our climate risks, we are actioning what we consider to be the most appropriate strategies for our business. We have set three business-wide commitments that seek to address them, including becoming Net Positive in carbon and water by 2040 as well as embedding circular economy principles across our business operations by 2030. These policies – and the actions that support them – minimise our impact on the environment. For instance, our Sustainable Building Policy and Shopping Malls Sustainable Operations Policy outline how we can reduce embodied and operational carbon from our activities. Moreover, we have invested in many successful projects to maximise our onsite renewable energy generation capacity and have explored high-quality renewable energy procurement in the form of PPAs across our portfolio.

These examples are just a small selection of the actions we are taking today, and we intend to take many more in future. As we learn from sustainability experts and our industry peers, we are identifying new opportunities to have a bigger and better impact on our planet. For example, nature-based solutions (NbS) shone front and centre at COP26 as a non-negotiable fundamental for securing a sustainable future. We are seeing many businesses invest in large-scale NbS projects to address climate risks, including the regeneration of watersheds and wetlands to tackle drought risks and the restoration of mangroves to tackle sea-level rise and coastal flooding. To support these efforts, Majid Al Futtaim is working diligently to finalise a five-year climate risk resilience action plan, a comprehensive strategy that will be aligned with the science-based targets for nature. By identifying impactful actions to support the ecosystems over which we have influence and integrating these concerns into our business-wide climate risk strategy, we will simultaneously be able to achieve climate resilience and nature-positive outcomes.

?The timing of our climate transition action plan is pertinent. Many have said that COP27, to be held in Egypt this November, could be the final chance for the world to come together to address the climate crisis and achieve net zero emissions1. Egyptian officials have announced that climate change adaption and resilience, as well as the urgent need for climate finance, will be top of the agenda. This only reinforces what we at Majid Al Futtaim already believe and are working toward: it’s only by understanding the material climate risks that we face; can we implement the appropriate climate resilience strategies that will yield truly sustainable outcomes for decades to come.

?References

1https://www.unpri.org/sustainability-issues/climate-change/the-pri-and-cop27#:~:text=COP27%2C%20the%20annual%20UN%20climate,line%20with%20the%20Paris%20Agreement