Climate change costs the economic system: examining ten years (2009-2018), an additional degree of temperature determined an average reduction in turnover of 5.8% and 3.4% of profitability for Italian companies.
If we then consider the actual changes in the climate in the various geographical areas, in 2018 alone - a particularly hot year - our business fabric recorded lost revenues of 133 billion euros, with the largest percentage losses in the North East and the Center.
This is what emerges from the first year of activity of the Climate Finance Observatory of the School of Management of the Politecnico di Milano, which has developed a database that crosses economic-financial information on 1,154,000 companies in Italy between 2009 and 2018.
The Observatory, a note reads, calculated "the real, not hypothetical damage, due to the 1 degree centigrade increase in temperature in Italy: small businesses are the ones that have lost the most in profitability (-4%, compared to -5.3% of turnover), while large companies, being able to act better on costs and processes, despite a decrease in revenues and demand equal to almost three times (-14.6%), have contained the loss of margins at -3.6% ".
Among the sectors, construction (turnover at -16.2%, Ebitda at -6.8%), finance (-11.8% and -5.9%), which suffered both direct and indirect impact through damage to client companies and extractions (-10.4% and -7.6%) suffered the greatest repercussions from the increase in temperature.
Information technology, real estate and research and innovation have seen the same drop in turnover (-6.4%) but with a very different decrease in margins (respectively -6.8%, -4.6% and -3%). Manufacturing (-5.2% of turnover and -2.4% of Ebitda) and retail (-4.5% and -3.1%) are the sectors that have best defended themselves, preceded only by agriculture, tourism and transport which, with little impact, contained both indicators within -3%.
"Managing the consequences of climate change and mitigation strategies represent the greatest challenge that world economies will have to face in the coming years - comments Roberto Bianchini, director of the Climate Finance Observatory - For example, the analysis shows how a flood could cost companies in the affected area up to 4% of turnover and a loss in value of balance sheet assets of about 0.9%, which rises to 1.9% in the event of a large fire. 'global emergency linked to the pandemic has contributed to increasing the perception of risk, because it has shown how economic actors suffer consequences not only directly, but also indirectly, through the channels of demand, of thesupply or its own supply chain ".
The increase of one degree of temperature in the years from 2009 to 2018 cost mainly companies in Central Italy (-10.6% of turnover and -8.5% of Ebitda) and in the North East (-10% and -4 , 2%), where, however, companies have managed to maintain greater margins. The North West saw a sharp loss in profitability (-6.8%) but not as much in turnover (-4.5%), while the South and the Islands were little affected by climate change (-1% and -2 respectively. , 3% of Ebitda; -4.3% and -3.1% of turnover).
The Climate Finance Observatory of the School of Management of the Politecnico di Milano explains that "in order to have a more precise analysis, region by region, 2018 was analyzed in detail, a warmer year than the average in the decade".
In percentage terms, the greatest repercussions were in the North East (Veneto -7.1%, Trentino Alto Adige -6.7%, Friuli Venezia Giulia -6.4%) and in the Center (Tuscany -6.5%, Lazio -6.3%, Emilia Romagna -5.2%, Umbria -3.2%; Marche and Abruzzo did not give appreciable estimates), while the North West contained the losses (Lombardy and Liguria -3%, Piedmont -2 , 5%; in contrast the Valle d'Aosta, -4.1%). The damage to the South is decidedly more limited: Calabria and Sardinia stood at -2%, a threshold below which all the other regions are located, from Basilicata (-1.9%) to Molise (-1.4%) , Campania (-1.2%), Puglia (-1.1%), up to 0.07% of Sicily.
On the other hand, examining the decline in turnover in absolute figures, the most significant losses were recorded in Lazio (almost 27 billion euros less), Lombardy (-25.7), Veneto (-24.7), Emilia Romagna (-17 , 3) and Tuscany (-13.5). Piedmont (-6.1), Trentino Alto Adige (-5), Friuli Venezia Giulia (-4.2), Liguria (2.5), Campania (- 1.9), Puglia and Umbria (-1.2). Under the billion, Sardinia (840 million), Sicily (716), Calabria (about 600), Basilicata (280), Valle d'Aosta (250), Molise (156), ending with Abruzzo's 718,000 euros and 531,000 of the Marche.