COVID-19 has caused unprecedented disruption, triggering simultaneous global market lockdowns. While the consequences of COVID-19 are ongoing, many are already questioning why so few companies and markets were adequately prepared to address the impacts of a pandemic, a well-documented risk that has appeared throughout history.
Pandemics or spread of infectious diseases have featured prominently in the World Economic Forum’s (WEF) Global Riska Report for the last 10 years. Despite these warnings, the acute impact of COVID-19 has highlighted a clear gap between identifying risks and developing mitigation or response strategies. This has come at enormous health and economic cost. The low point on 23 March saw around $26 trillion wiped off the global stock market valuation. Coupled with record breaking global unemployment levels, drastic declines in consumer spending, and widespread factory shutdowns, it suggests there is a long road to economic recovery.
The lack of existing government and organisational mitigation and response planning highlights the need to ensure we learn from this crisis in order to better manage other systemic risks in the future.
While climate risk continues to grow, we can learn from the impact of COVID-19 about how to develop better crisis prevention and response. This will require organisations and governments to act rapidly to deliver integrated risk, strategy, governance and reporting on climate risk.
Read the next section: How can we use the lessons learnt from COVID-19 to better prepare for climate change?
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