- Describe the climate related risks and opportunities the organization has identified over the short, mid and long term
NSG Group Approach
The scenario analysis activity identified the physical and transitional material aspects to NSG Group on a timescale looking forward to 2100, according to 3 key scenarios;
- Low Carbon World (<2°C) – associated with aggressive mitigation to limit carbon emissions over the next 30 years in order to move to a low carbon economy.
- RCP 4.5 Intermediate (2-3°C) – an intermediate scenario which assumes current policies, pledges and targets are met.
- RCP 8.5 Hot House World (>4°C) – the world continues to increase emissions doing very little if anything to avert physical risks. The worlds temperature continues to increase significantly with catastrophic consequences
Further description of some of these aspects and others regarding physical risk analysis outcome is given below;
- Current regulation - e.g. European Energy Directive - opportunity in supplying high performance products associated with the directive Emerging regulation, e.g. new industrial Emissions Trading Schemes (ETS) leading to risk of increased operational costs. New EU building ETS leading to opportunities to supply high performance energy saving products.
- Technology development - e.g. EV market growth, low energy buildings market growth.
- Legal compliance - risk & cost of meeting future compliance, opportunities associated with more stringent product demands and NSG competitive product development.
- Market aspects - e.g. customer specifications for building / vehicle efficiency with associated opportunities for product development
- Reputation - e.g. risk associated with customer or other stakeholder perceptions.
- Acute Physical - e.g. flood, typhoon risk impact to operations & value chain (supply continuity) opportunity for specific product development e.g. storm glazing.
- Chronic Physical - e.g. sea level rise primarily risk impact to current and future operations and value chain.
Risks & opportunities identified were quantified and categorised according to the NSG Group standard risk management framework and prioritised accordingly. They include impacts from; Policy & legal aspects, Technology aspects, Market aspects and Reputational aspects.
Assessed Range of annual impact and likelihood of transition risks – residual risk on Long term horizon (2035) under a Low Carbon World scenario:
■Examples of risks with heavy impact or high urgency
Further Disclosure / Information sources
CDP report 2022 C2.1 - C2.4