From Flooding to Fire: How can you prepare for the impacts of El Niño
Australia is officially entering El Niño, raising the risk of record temperatures, prolonged drought, and bushfires – but what does this mean for your operations and assets?
WHAT IS EL NIÑO?
According to the Bureau of Meteorology, an El Niño occurs when “sea surface temperatures in the central and eastern tropical Pacific Ocean become substantially warmer than average, and this causes a shift in atmospheric circulation.”
This change in the climate system can occur every three to seven years and can last just a few months or up to several years. El Niño events are associated with a weakening, or even reversal, of the current trade winds and as a result bring reduced rainfall, increased risk of fire, extreme changes in temperature, and a reduction in tropical cyclones.
Whilst El Niño takes place in the Pacific Ocean, the wider impacts of the event are felt across the globe, such as flooding in countries such as Peru and Ecuador, drought in the Amazon region, and can even be responsible for colder winters in Europe.
After a few years of La Nina, the term used to describe the episodes of cooler than average sea surface temperature in the equatorial Pacific, El Niño returned in 2023. While the conditions aren’t at their peak just yet, organizations need to understand the effects of the event as it gains strength over the coming months and years.
HOW DOES EL NIÑO IMPACT BUSINESSES?
Depending on your organization, El Niño may have a direct impact on your operations, or you may be indirectly affected by the repercussions of such a drastic change in the climate. The changes caused by El Niño are far-reaching and can significantly alter the daily operations of the infrastructure, agriculture, health, and energy sectors.
Because of the recent rare prolonged period in La Nina, many areas of Australia have seen increased levels of rainfall which have created an environment for vegetation and grasslands to thrive. Experts are warning that this abundance of fuel across the nation means a much higher level of wildfire risk due to the pending hotter and drier conditions typical of El Niño.
The unpredictability of bushfires and the speed at which they can spread is the reason a record number of organizations placed the natural hazard as a top business continuity concern in 2022.
Even when your people or property aren’t directly impacted by the wildfire, organizations must seriously consider the indirect impacts including poor air quality, road closures, and transportation disruptions that can be felt across entire regions and persist for months.
Beyond the risk of wildfire, extreme weather conditions can cause extensive disruption to your business production and supply chain. And as we’ve witnessed in recent years with COVID-19, and the Russia-Ukraine War, this kind of disruption can drive the price of commodities such as food and fuel.
HOW CAN YOU PREPARE YOUR BUSINESS FOR THE EFFECTS OF EL NIÑO?
Many reports suggest that this occurrence of El Niño will be strong and challenging – although there’s no way to be certain.
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What we can be sure of, however, is that organizations with a robust and reliable risk management strategy will be far more resilient against the far-reaching impacts of El Niño, regardless of how long it lasts. Particularly if your organization operates in Australia or the regions impacted by El Niño, you need to implement and test your business continuity plans now to ensure you can minimize the disruption the upcoming change in the climate system will cause.
How well do you really know your enterprise’s unique risk profile? Being able to visualize your entire global supply chain, quickly identify which of your critical suppliers are most at risk over the next few months, and understand the loss values of each asset in a single platform could be the business-critical transparency you need to protect your bottom line.
Sigma7 is a truly integrated risk management platform, providing completely independent and client-focused outcomes.
We've aggregated world-leading risk capabilities across risk engineering, forensic accounting, intelligence and security, cyber, crisis management, training, and business investigations to identify, categorize and visualize your unique risk data and completely map out your operations, including your physical and cyber assets, people, and supply chain.
Our end-to-end risk solutions aim to give you the insight you need to be more intentional with your risk investment, protect your assets, and minimize disruption despite an increasingly complex and dynamic risk landscape.
Speak to a member of our team today to better understand what action you need to take now, and how we can support you.
OUR EXPERTS:
Jason Chua, Regional Director for Risk Engineering, Australia and New Zealand
Andrew Tait, Integrated Risk Leader
Andrew Foote, Senior Consultant and Wildland Fire Practice Lead