Promoting Disaster Risk Sensitive Investments


High water: Integrated water resource manager Vinesh Kumar shows Ms Wahlström how a water monitoring station on the Nadi river works and fits into a wider early warning system that reaches the last mile to thousands of vulnerable people.

Margareta Wahlström, Special Representative of the Secretary-General for Disaster Risk Reduction discusses creating private sector networks with Nosh Nalavala

Nosh Nalavala: In May, the United Nations Office for Disaster Risk Reduction (UNISDR) launched the R!SE Initiative which  promotes Disaster Risk-Sensitive Investments. Since you are moderating a session on creating private sector networks at the SIDS Conference in Apia, how significant is this new initiative to SIDS?

Margareta Wahlström:  The R!SE Initiative is about bringing disaster risk into the corporate board room and investment decision-making process. It is an alliance across disciplines and functions including academia, science, the public and private sectors and is an interesting and potentially significant initiative for Small Island Developing States.

Q: Could you elaborate on this?

A: The way investment decisions are made in the areas of tourism, fisheries, energy, transportation, and information and communications technology, among others, will play a decisive role for the resilience and sustainable development of small island developing states. If already limited resources are invested without adequate understanding and consideration of disaster risk then they will simply lead to the accumulation of more risk and further economic losses in hazard-prone areas. To give an example, one of the key outcomes expected from the R!SE Initiative is an improved framework for economic forecasting that takes into account issues such as countries’ level of preparedness, capacity to recover, and exposure of GDP to disasters. Disaster risk has largely been absent from economic planning so far allowing many risk-generating investments to go unchecked, so such a tool could catalyze a change in the way everyone, including actors in small island developing states, make big and small resource-allocation decisions.

Q: You have six partners in this initiative. Do you plan to expand the roster of private companies and how do you visualize their contribution to LDCs and SIDS?

A: The R!SE alliance was founded by a group of 7 organisations, including UNISDR, PricewaterhouseCoopers, Willis, AECOM, the Economist Intelligence Unit, Florida International University and the Principles for Responsible Investment. It is an alliance that is expanding and growing as we speak: at the launch event in New York, we were able to announce that AXA, Citibank, Nippon Telegraph and Telephone Corporation, Risk Management Solutions and Walmart have already joined.

Q: And what are the activities of this initiative?

A: The scope of our ambition is revealed by detailing the eight activity streams which are strategies for global business; risk metrics for economic forecasting; industry sector certification; executive education and professional training; principles for responsible investing; resilience of cities; insurance; and the resilience of UN programming. Each of these activity streams is spearheaded by an industry leader and fuelled by the collective expertise from an increasing number of partners. The R!SE initiative is on track to grow rapidly given the growing awareness in both the public and private sectors of the need to build disaster resilience and to curb rising economic losses.

Q: The mission is to “mainstream disaster risk management into corporate planning and investment decision-making.” How will this narrative help small island developing states?

A: There are two important facts to bear in mind.

First, private investment is the single most important determinant of disaster risk because 70-85% of overall investment is made by the private sector including annual institutional investments worth more than $80 trillion globally.

Second, disaster losses do not just occur naturally but depend on the way past investment decisions have been made and the range of factors that influenced those decisions. We have learned this through the last few decades, so moving forward, it is important to ensure that resources are not invested in ways that create new and unmanageable risk of losses should a hazard strike.

We are essentially working to change the way business is done, and what we have learned so far is that embedding disaster risk management in business processes is key not just to resilience but also to competitiveness.

Q: So how is this relevant to small island developing states?

A: While they face high levels of disaster risk, it is also true that they are the group of countries where investments in disaster risk reduction are likely to reap the greatest benefits. In fact, the private sector in SIDS – for instance, the tourism industry has the opportunity to really take leadership and show by example how resilient investments can lead to sustainable economic growth.

Q: UNISDR is working for a safer world in the 21st century. What is your vision of making the very risk and disaster prone vulnerable countries “safer”?

A: Our vision is of a world where disaster losses are minimized. While it is true that we cannot eliminate the risk of disaster losses altogether, we know equally well that a significant percentages of disaster losses are preventable. We want to realize this vision by integrating and embedding risk management across all kinds of decision making in societies to ensure, that generation of new disaster risk is reduced to the minimum; existing disaster risk is known, reduced or managed; and, resilience of individuals, communities and economies is proactively strengthened.

We also see this as a critical contribution to realize the vision of the post-2015 development agenda.  Unless risk and resilience sensitive development planning is at the core of the development vision, it will continue to be undermined and thrown off course by shocks and by disasters that will cause economic and social set backs to communities and countries.

Q: I understand that you are getting together with SIDS to meld adaptation with disaster risk reduction. What steps are you taking towards that goal?

A: In fact, Pacific States and territories are driving this agenda themselves. The Pacific is the first region in the world to clearly foresee the obvious links between climate change, disaster risk reduction and sustainable development policies. They’ve come together and developed a Strategy for Climate and Disaster Resilient Development. This regional strategy, due to start implementation next year, will for the first time comprehensively integrate approaches to managing disaster and climate risks. We’re also seeing SIDS lead in efforts to integrate action at the national level through Joint National Action Plans on Climate Change and Disaster Risk Management and the establishment of joint national advisory boards on climate change and disaster risk management. We’re working closely with SIDS, and their partners, to realize these efforts to strengthen their resilience and build sustainable communities. In early June we co-hosted the 6th Pacific Regional Platform on Disaster Risk Management which has made several valuable recommendations for inclusion in the new global framework for disaster risk reduction which will be adopted in Sendai, Japan, at the Third UN World Conference on Disaster Risk Reduction in March, 2015.

Q: Do you see an active public-private sector role in resilience building? And what steps has UNISDR implemented to make that happen?

A: Strengthening resilience can only be achieved by the public and private sectors working together. The evidence is clear — with the shared risk faced, comes a shared responsibility to manage and reduce existing risk and minimize future risk. There is a strong desire from both the public and private sectors to strengthen collaboration around risk management. This is good for business and good for countries. UNISDR’s role is to support and facilitate this work and it is doing this through a number of avenues, including the R!SE initiative and the Disaster Risk Reduction Private Sector Partnership, with guidance from our very active Private Sector Advisory Group.

Q: Could you give a glimpse of the Hyogo Framework for Action? Is the private sector playing a significant role towards the 10-year plan to make the world safer from natural hazards?

A: The Hyogo Framework for Action (HFA) is a 10-year plan to substantially reduce disaster losses by building the resilience of nations and communities to disasters which was endorsed by the UN General Assembly in 2005. It was developed and agreed on with the many partners needed to reduce disaster risk, bringing them into a common system of coordination. Commendable progress has been made across the HFA’s five priority areas, especially in strengthening institutional arrangements in disaster risk reduction, bolstering disaster preparedness and enhancing early warning systems. The private sector has been strategically placed to make communities safer because of its direct outreach to the customer.

Q: How would the Post-2015 framework on disaster risk reduction be different from the Hyogo Framework for Action?

A: The HFA is still valid in many ways and its work needs to continue to achieve its expected outcome.  However, the new framework will need to address the underlying factors which drive risk and to avoid the creation of new risks as we build more to cope with population growth and rapid urbanization. There needs to be more emphasis on integrating disaster risk into public policies, ensuring coherence across institutional boundaries, sectoral policies and financial instruments. I also hope that the monitoring, reporting and review mechanisms will be much enhanced in the new framework.

Q: As you work towards mainstreaming Adaptation and Disaster Reduction, what kind of a development outcome do you foresee?

A: As governments deliberate on the post-2015 development agenda which will serve as our sustainable development paradigm, the question we must bear in mind is ‘how can we reach our development goals while accounting for current and future risks?’ I am optimistic about the future development outcome and foresee a transformation in the way we ‘do’ development so that risk prevention becomes the gold standard that all development actors abide by. So far, strong support has been seen for risk-sensitive development goals in the proceedings of the Open Working Group on Sustainable Development Goals. In fact, many SIDS are taking the lead in highlighting the need for integrating risk management across all sectoral goals.

Q: Most initiatives suffer from lack of communication and advocacy to communities most impacted. Do you and UNISDR have a plan of action?

A: As a coordination body, UNISDR works with a wide range of stakeholders which includes national governments, local authorities, the UN system and community based organizations among others. Therefore, communication and advocacy is at the heart of our mission. UNISDR, with the tremendous support of our partners, has launched several successful advocacy initiatives in the past. For instance, every October 13, the world celebrates the International Day for Disaster Reduction with strong grassroots contributions from all over the world; this year, the IDDR is going to highlight the role of older persons in building resilience. Also, the UNISDR Resilient Cities Campaign, ongoing since 2010, has mobilized more than 1,840 local governments and municipalities to take action on disaster risk reduction so far and is still going strong.

 

Interview first appeared in the UN publication THE COMMITMENT

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