Climate change tops future risks as more people feel its effects

Climate change has ranked first in risk experts and the general public’s perception of future risks – as more than three-quarters of survey respondents reported feeling vulnerable to its impacts in their daily lives.

AXA’s Future Risks Report 2024 surveyed more than 3,000 risk experts from 50 countries, as well as close to 20,000 people from the general public in 15 countries to find out which risks were perceived as the most pressing.

Climate change was the top concern for both experts and the general public on every continent, for the second year in a row – above geopolitical instability, cybersecurity, artificial intelligence and social tensions.

This may be because the number of people feeling the impact of a warming planet in their daily lives is increasing: 77% of the general public who selected this risk in their top five say they feel vulnerable to it – up from 73% last year.

However, the survey notes regional differences in the perception of climate risk: in Europe, 67% of experts and 49% of the public put the risk in their top five, compared to 43% and 38% respectively in the United States.

More investment needed for climate adaptation

AXA notes in its report that “mitigating climate change will urgently require massive investment”, but that it may be increasingly challenging for governments to invest at the scale needed.

“The increasing financial burden of an ageing population will strain government budgets, making it more challenging to allocate much needed funds for the ecological transition,” the authors write. 

However, failing to invest in climate adaptation could cause much greater costs, with the Potsdam Institute for Climate Impact Research estimating that climate change is on course to cause US$38 trillion in damages every year by 2050 – six times the investment needed to mitigate global warming.

Read also: Climate resilience approaches (and budget considerations) for Chief Sustainability Officers

“Exact predictions are difficult because it is hard to be confident how severely climate change will exacerbate other risks,” AXA adds, citing climate migration and related social tensions as one of these potential impacts.

COP29 seeking to secure ‘hundreds of billions’ of climate finance

The report comes just a few weeks before the beginning of COP29, where world leaders will seek to agree on a new climate finance package to replace the previous goal of providing US$100 billion a year to developing economies for climate mitigation and adaptation.

Yesterday, the COP29 presidency indicated that a new goal “in the hundreds of billions” would be realistic, despite acknowledging that funding needs are “in the space of trillions” of dollars.

The previous target of US$100 billion a year was missed every year from 2013 to 2021, and was only met for the first time in 2022, according to the OECD.

Awareness of nature and biodiversity risks remains limited

The AXA survey also lists ‘natural resources and biodiversity’ as a future risk – ranked number six among risk experts. However, this risk still doesn’t make the top 10 among the general public, suggesting that awareness of nature and biodiversity risks remains low.

This is an increasingly important area of action in the corporate world, with companies urging governments to legislate on the topic ahead of COP16 – the ‘Biodiversity COP’ taking place in Colombia later this month.