Future Ready Features: 4 Things To Know

As May gives way, and we look ahead to a month of Pride, freedom and mental health awareness, we are inspired by resilience in its many forms.

Small enterprise, big influence

Micro, small and medium-sized enterprises (MSMEs) are everywhere – the backbone of local communities across the globe. Consider that MSMEs:

• make up approximately 90 percent of businesses worldwide
• are responsible for more than 50 percent of employment

Collectively, they can have major influence in driving sustainable economic development and societal progress, especially in emerging markets and developing economies.

The problem is, MSMEs face significant constraints in accessing financing to facilitate business growth and sustainability efforts. That second piece is important. As countries face the challenge of building resilience to climate change and preventing environmental degradation, MSMEs can play an outsized role. But they need resources.

Recognizing this need, and the transformative impact of sustainable financing, the International Finance Corporation (IFC) took up the challenge. In its recently published “Sustainable MSME Finance Reference Guide,” IFC sets out a practical approach for financial institutions to identify, finance and/or refinance MSME assets and activities in emerging markets.

Learn why it might be a game changer for this critical segment of our global economy.

Full disclosure for climate-risky business

There is no doubt that businesses are operating in an ever-riskier climate.

According to the National Oceanic and Atmospheric Administration (NOAA), in 2023 the U.S. experienced 28 billion-dollar disasters — the most on record in a single year — totaling at least $92.9 billion. They included severe weather, tropical cyclones, major flooding events, historic heat waves, cold wave, massive wildfires (see Maui, Hawaii) and tornadoes.

As the impacts associated with a changing climate become more evident, businesses are under ever more pressure from stakeholders to disclose their transition risks (related to greenhouse gas emissions) and physical risks (related to extreme weather events, sea level rise and variability in climate patterns). Putting this focus on accountability and transparency into even starker relief is the recent adoption of “The Enhancement and Standardization of Climate-related Disclosures” rule by the U.S. Securities and Exchange Commission.

The rule requires all publicly traded companies to disclose climate-related information in their registration statements and annual filings. And while there are ongoing legal challenges — and debate about whether the rule went too far, or not far enough — the bottom line is businesses need to prepare for compliance.

Here are five things that companies need to do now.

Critical in crisis: planning, partnerships, communication

The collapse of the Francis Scott Key Bridge in Baltimore in March was another difficult reminder that our nation’s transportation infrastructure is vulnerable.

If not to a sudden shock like a hurricane or a chronic climatic stressor like extreme heat, it could be a ship strike or a cyber-attack or any number of other catastrophes that cripple our bridges, roadways or transit systems. Add to the abundance of potential threats the reality of our aging infrastructure, and it’s hard not to consider the consequences.

According to the 2021 Report Card for America’s Infrastructure (most recent data), our overall U.S. score was a C- across all infrastructure assets. Contributing to this less than stellar grade:

• More than 42 percent of our 617,000 bridges are over 50 years old.
• More than 40 percent of our roadway systems are in poor or mediocre condition.
• More than 36.4 percent of transit facilities, 21.4 percent of transit systems, and 18.5 percent of transit vehicles are rated in “poor” condition.

This leads to obvious conclusions: investment in our infrastructure is paramount to a safe and reliable transportation network, and building resilience into our infrastructure is critical to accounting for a future that will look and feel substantially different than today. However, it also speaks to the need to anticipate crisis, to ensure immediate and decisive response in those moments that arrive suddenly and without warning.

Learn how Departments of Transportation coalesce preparation, scenario planning, key partnerships and clear communication to manage the scenarios no one wants to face.

No size fits all in urban resilience

Like many things — geographic features, availability of resources, population growth, transportation needs — the impacts of climate change are place based. Risks can vary dramatically from one community to another, from prolonged droughts and heatwaves here, to frequent and intense rain events there, to tornadoes and hurricanes over there.

As such, our future infrastructure not only needs to be flexible and adaptable to trends in climate, society, technology and resources, but it needs to be practically applicable within a local context. To wit: rigid and broad-based design criteria doesn’t much serve this objective, but innovative whole-of-industry and location-specific thinking does.

So, when we look to build urban resilience in this place or that, understanding the unique community, and its needs, priorities, vulnerabilities and threats, is critical. Once we know that, we can get very creative in the context-sensitive solutions we apply. And there has perhaps never been a time riper with possibility in the design of sustainable infrastructure.

The emergence of green infrastructure or nature-based solutions, low-carbon materials, digitization and technology-driven connectivity, is changing the game and enabling much more holistic approaches, no matter how specific the context.