Why Challenge Your Climate Assumptions?
Business decision-making experts, from van der Heijden to Chip and Dan Heath, routinely recommend that company decision-makers regularly challenge their core business assumptions. The key reasons they cite can be grouped as follows:
- Because bad assumptions lead to bad decisions
- Because it can help overcome "willful blindness."
- Because it can help overcome cognitive barriers to robust decision-making
- Because it's key to successful scenario planning
When it comes to climate change specifically, unchallenged assumptions can easily undercut prudent climate responses. Consider the following examples:
- "We've always adapted, we'll adapt!" (Former Exxon CEO Rex Tillerson)
- Climate change may be a big societal problem, but it's not a business problem
- It's already too late to do anything about climate change
- Opponents of climate policy will continue to successfully undercut policy efforts
- People not concerned about climate change are stupid and immoral
- Tackling climate change would be ruinously expensive
- Technology will ultimately "solve" climate change
- The cognitive barriers to climate action are simply too big to overcome
- We probably can't do anything about climate change
Several of these assumptions have huge implications for whether to even try to tackle climate change, who should tackle climate change, and whether we stand any realistic chance of solving the problem if we do tackle it. Assumptions frame conversations and beliefs, and it can be very difficult to get beyond them. That is why so many business experts stress the importance of challenging our personal and business assumptions in order to improve the overall quality of our decision-making. Climate change is no different, even though the cognitive dissonance created by climate change poses unique challenges.
Following on van der Heijden quote that we started with, there is little question that climate change is a “big unarticulated issue” for many if not most companies. Between the known knowns, known unknowns, and unknown unknowns of climate change; the 1st, 2nd, and 3rd order impacts of climate change; and the direct relationship of uncertainty to business risk, it is hard to over-state the potential business materiality of climate change.
So why do so few companies seem to be looking at climate change as their “big unarticulated issue”? One key reason, as articulated by ven der Heijden, is that many business decision-makers are locked into questionable or out-of-date assumptions regarding climate change, climate risks, and climate risk management. It’s not at all surprising given how rapidly the business climate risk conversation has evolved, but it does pose a problem for robust business decision-making.