Extreme weather events are expected to affect a majority of global mining companies, very few of which have taken action to protect assets from climate change risks, according to an Acclimatise report supported by IBM.
The Global Mining – The Adaptation Challenge report says 80% of respondents believe their assets will be affected by variations in weather, however, only 13% are taking concrete steps to safeguard critical infrastructure and technology.
The report is based on the Carbon Disclosure Project's annual information request sent to 144 major global mining companies out of which 43% provided a detailed response.
The responses were analysed using Acclimatisation Index Methodology.
The report describes the adverse affects of climate change on cost and revenue for mining companies including impact on natural resources, employee health, stable energy supplies and rise in transportation and operating costs.
It also says that global mining companies have to alter their way of thinking and operating to improve their business against the backdrop of climate change.
Only 3% of respondents offered proof that they had made major changes in their decision-making to better adapt to climate change.
The report says that there is a lot of ambiguity surrounding future regulatory policies to address such challenges and called for changes to help improve investment in the sector.
Carbon Disclosure Project COO Paul Simpson said the report highlights the importance of drafting a plan to adapt to climate change.
"Issues such as operating cost, community impact and reputational risks will impact if not managed effectively," Simpson said.
"As a result, investors want to know how mining companies are dealing with these risks and planning for them in the future.