shifting from managing disasters to managing …...understanding disaster risk 2. strengthening...

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Shifting from managing disasters to managing disaster risks Implementing the Sendai Framework

Organisations today face more frequent crises – and the impacts of those crises are becoming more significant.

That’s why we created PwC’s Global Crisis Centre, an international centre of excellence that helps you prepare for, respond to and recover from a crisis.

Global Crisis Centre

2 • Global Crisis Centre

“If you see that we’re already spending huge amounts of money and are unable to meet the humanitarian need – and then you overlay that with not just population growth… [but] you put climate change on top of that, where we’re seeing an increase in the frequency and severity of natural disasters, and the knock-on effects with respect to food security and conflict and new viruses like the Zika virus – you realise that the only way we’re going to be able to deal with these trends is by getting out ahead of them and focusing on reducing disaster risk.” Robert Glasser, Special Representative of the UN Secretary-General for Disaster Risk Reduction, 24 April 2016

1 Source: Sendai Framework for Disaster Risk Reduction 2015-2030: http://www.preventionweb.net/files/43291_sendaiframeworkfordrren.pdf

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Implementing the Sendai Framework

Making better risk-informed decisions

• Developing a logical pathway for businesses and organisations to increase their practical awareness of major global trends through information, application and education

The broader context

• Most disasters that could happen have not yet happened

• Investment decisions rarely take into account the level of hazard

• New risks have been generated faster than existing risks have been reduced

Disaster risk impacts1

Between 2005 and 2015: • 700,000 lives lost• 1.5 billion people were impacted globally

• US$1.3 trillion of direct economic loss

From words to action

• The talking is over, the Sendai Framework has been adopted, it is now time for action: understanding and managing risks, investing in resilience, and preparing for, responding to and recovering from crises

• The ARISE initiative is a global, United Nations led effort to mobilise private sector action on disaster risk reduction

Global Crisis Centre • 3

Three key intergovernmental agreements made 2015 the milestone year for defining the world’s sustainable development agenda through to 2030 and beyond:

1. The Sendai Framework for Disaster Risk Reduction 2015-2030 was adopted at the 3rd UN World Conference on Disaster Risk Reduction, held in Sendai, in March 2015.

2. The 2030 Agenda for Sustainable Development, including the Sustainable Development Goals (SDGs), were approved at the UN Summit to Adopt the Global Goals, held in New York in September 2015.

3. The new universal, legal agreement on climate change, the Paris Agreement, was adopted at the 21st Conference of the Parties to the UN Framework Convention on Climate Change (COP21) held in Paris, in December 2015, and to which more than 175 nations have signed up since April 2016.

2 The ARISE initiative: http://www.preventionweb.net/arise/node/1

Resilience cuts across all issues and is an opportunity for development for private and public sectors:

• As stated by the United Nations’ Secretary-General Ban Ki-moon, “Sustainability starts in Sendai.”

• The SDGs and the Paris Agreement explicitly reference the cross-cutting issues of disaster risk reduction, disaster risk management and resilience.

• The Sendai Framework states: “Reducing disaster risk is a cost effective investment in preventing future losses. Effective Disaster Risk Management (DRM) contributes to sustainable development.”

The UNISDR (United Nations Office for Disaster Risk Reduction) started the ARISE2 initiative to support the implementation of the Sendai Framework:

• ARISE was formed to help create risk-resilient societies by energising the private sector in collaboration with the public sector and other stakeholders to achieve the outcome and goal of the Sendai Framework in a transparent and inclusive way that delivers local and measurable impact.

• PwC provided input into the creation of the UNISDR led ARISE initiative (formerly R!SE) to build a global private-public collaborative platform for disaster resilience.

“The Sendai Framework has important implications. It shifts the emphasis from disaster management to disaster risk management.”

Ban Ki-moon, United Nations Secretary-General, 1 September 2015

http://www.preventionweb.net/arise/node/1


Colliding megatrends

PwC has identified five megatrends 3 that are shaping and disrupting social, ecological and economic systems.

As global interdependencies continue to grow, the collisions between these megatrends are posing major challenges but also creating new opportunities globally and locally.

By analysing how the megatrends affect critical systems we will better understand the underlying drivers of disaster risks and more efficiently improve access to appropriate, actionable disaster risk information.

This will help businesses and organisations to make more risk-informed decisions and increase resilience.

We encourage businesses and governments to map the possible impact of these megatrends on their organisations.

3 The PwC Global Megatrends https://www.pwc.com/gx/en/issues/megatrends.html 4 National Intelligence Council: Global Trends 2030: Alternative Worlds 5 World Urbanization Prospects: 2011 Revision, Produced by the UN Department of Economic and Social Affairs

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The broader context Colliding megatrends and disaster risk impacts

Demographic and social change:Explosive population growth in some areas against declines in others contributes to everything from shifts in economic power to resource scarcity to the changes in societal norms.

Shift in global economic power:The focus of global growth has shifted. Western economic dominance is a relatively recent phenomenon, and the developments we see are essentially a rebalancing of the global economies.

Climate change and resource scarcity:Scarcity of resources and the impact of climate change are of growing economic concern. By 2030, demand for energy is forecast to increase by as much as 50%, water by 40% and food by 35%4.

Rapid urbanisation:It is estimated that around the world, 180,000 people move to cities every day. By 2050, the world’s urban population will have increased by some 72%5.

Technological breakthroughs:Breakthroughs in nanotechnology and other frontiers of research and development are increasing productive potential and opening up new investment opportunities. The combination of the internet, mobile devices, data analytics, and cloud computing will continue to transform our world.


Disaster risk impacts6

UNISDR reports that globally, new risks have been generated and accumulated faster than existing risks have been reduced. Annual observed and future estimated losses from disasters have subsequently increased as well:

6 UNISDR Global Assessment Report on Disaster Risk Reduction 2015. http://www.preventionweb.net/english/hyogo/gar/2015/en/home/index.html

• Economic losses from disasters now average US$250 to $300 billion annually, and are trending up.

• Future losses are now estimated at US$314 billion in the built environment alone – this is the amount that countries should set aside each year to cover future losses and does not include losses in rural areas.

• 42 million life years lost in internationally reported disasters from 1980-2012, each year.

• 80% of life years lost in disasters originate from low and middle-income countries, representing an obstacle to sustainable development similar to diseases like tuberculosis.

Multi-hazard average annual loss (AAL): Earthquake, flood, cyclone wind, storm surge and tsunami

Source: UNISDR’s Global Assessment Report on Disaster Risk Reduction 2015 (GAR15).

Japan 62,528USA 52,626China 31,941India 9,825Germany 5,048Australia 5,521Brazil 4,508

In USD million

*droughts and agriculture not included

< 244

244 - 420

420 - 927

927 – 3,300

> 3,300


The Sendai Framework is different from earlier actions, really different.

The Sendai Framework is a unique global agreement in that it emphasises the importance of involving all stakeholders including the private sector and addressing financing and insurance mecha-nisms. Furthermore, the Sendai Framework has a clear outcome and goal, four priorities and seven targets (see highlights on the next page) to measure progress against through to 2030.

The Sendai Framework is unique in that it:

• Includes clear priorities for action for the private sector.

• Calls for business, professional associations and private sector financial institutions, including financial regulators and accounting bodies, as well as philanthropic foundations, to: “integrate disaster risk management, including business continuity, into business models and practices via disaster risk-informed investments…”

• Highlights the necessity for public and private sectors and civil society organisations, as well as academia and scientific and research institutions, to work more closely together and to create opportunities for collaboration, and for businesses to integrate disaster risk into their management practices.

• Calls for promotion of “mechanisms for disaster risk transfer and insurance, risk sharing and retention and financial protection, as appropriate, for both public and private investment in order to reduce the financial impact of disasters on governments and societies, in urban and rural areas.”

From words to action The Sendai Framework, ARISE and PwC


The ARISE initiative

The most concrete objective of ARISE is the commitment to implement tangible multi-stakeholder projects and activities to support the achievement of the seven targets of the Sendai Framework.

ARISE activities are organised around seven themes:

1. Disaster risk management strategies

2. Investment metrics

3. Benchmarking and standards

4. Education and training

5. Legal and regulatory

6. Urban risk reduction and resilience

7. Insurance

PwC and the ARISE initiative

In November 2015, following the adoption of the Sendai Framework, UNISDR streamlined its engagement with the private sector to create the ARISE initiative.

Oz Ozturk (Partner, PwC UK) co-chairs the ARISE Board working alongside UNISDR and several other global private sector businesses represented on the Board.

Seven targetsa. Global disaster mortality by 2030

b. The number of affected people by 2030

c. Direct disaster economic loss by 2030

d. Disaster damage to critical infrastructure and disruption of basic services by 2030

e. The number of countries with disaster risk reduction strategies by 2020

f. International cooperation to developing countries by 2030

g. The availability of and access to multi-hazard early warning systems and disaster risk information by 2030

One outcome

The substantial reduction of disaster risk and losses in lives, livelihoods and health and in the economic, physical, social, cultural and environmental assets of persons, businesses, communities and countries

One goal

Prevent new and reduce existing disaster risk through the implementation of integrated and inclusive economic, structural, legal, social, health, cultural, educational, environmental, technological, political and institutional measures that prevent and reduce hazard exposure and vulnerability to disaster, increasepreparedness for response and recovery, and thus strengthen resilience

Four priorities for action

1. Understanding disaster risk

2. Strengthening disaster risk governance to manage disaster risk

3. Investing in disaster risk reduction for resilience

4. Enhancing disaster preparedness for effective response and to “Build Back Better” in recovery, rehabilitation and reconstruction

Source: Sendai Framework for Disaster Risk Reduction 2015-2030, http://www.preventionweb.net/files/43291_sendaiframeworkfordrren.pdf

The Sendai Framework

http://www.preventionweb.net/files/43291_sendaiframeworkfordrren.pdf




DRM2030 is PwC's 15-year blueprint to contribute to the implementation of the Sendai Framework. PwC’s objective for disaster risk management is to help the public and private sectors make better risk-informed decisions, transforming risk information into knowledge, application and education. To that end, we developed the Disaster Risk Management Framework in alignment with the Sendai Framework.

Furthermore, as evidenced in the UNISDR GAR15, our society has concentrated vast amounts of risk and locked in the potential for disasters that can be triggered by natural hazards in the coming decades.

This is one of the reasons why PwC focuses on managing the risk of disasters, whilst also supporting the management of disaster preparedness, response and recovery through PwC’s Global Crisis Centre.

PwC’s Global Crisis Centre

At PwC, our purpose is to build trust in society and solve important problems.

PwC’s Global Crisis Centre works with organisations to build their ability to prepare for, respond to and recover from crises. Drawing on the expertise of our crisis teams from around the worldwide network of firms, organisations can reassure their own clients, communities and stakeholders that they’re able to manage a crisis effectively.

By preparing and responding effectively and quickly, both the public and private sector can emerge stronger and more resilient to global and local disasters. In turn, this builds trust in the services, processes and systems that are critical to our society as a whole.

PwC’s Disaster Risk Management Framework

By developing the Disaster Risk Management Framework (DRM-F) we can help governments and businesses create a comprehensive picture of their disaster risk management capabilities, how prepared and how ready they are to respond and recover from natural or man-made disasters.

What is different about the DRM-F?

We find that the majority of businesses and organisations continue to find it difficult to include externalities in their daily operations and decision-making, regardless of their size, sector or industry. Focus tends to be on enterprise risk management and business continuity planning as opposed to managing the underlying drivers of risk to build resilience and prevent the creation of new risks.

The DRM-F is holistic in that it creates a logical path for business and organisations to increase their practical awareness of major global trends in the context of the Sendai Framework. It is focused on incorporating risk information to better understand the underlying drivers of risk, and then to apply concrete approaches to better manage risks across all dimensions of impact, at all levels of decisions.

1. Inform: identify the importance of emerging trends, analyse their significance and inform the business.

2. Apply: assess the potential impacts of unexpected events; manage the impacts and prepare for the consequences; bounce back better from disasters.

3. Educate: enable continuous adaptation to change with a risk-informed understanding.

Making better risk-informed decisions Crisis and disaster risk management


DRM-F structure

The Disaster Risk Management Framework, as illustrated below, is aligned with the Sendai Framework’s four priorities and seven targets. We can help you apply it to your organisation.

www.pwc.com/ManagingDisasterRisks

Making better risk-informed decisions Crisis and Disaster Risk Management

2016 PwC. All rights reserved. PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity.

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PwC’s Disaster Risk Management Framework (DRM-F)


Whether a government, a public sector organisation, a city, a citizen or a business, the time to act is now. Every stakeholder is important and has the power to do something about DRM.

Our global society urgently needs tangible DRM examples that demonstrate catalytic impact and systemic change through multi-stakeholder projects and action.

PwC’s Global Crisis Centre DRM experts take an integrated perspective on global issues with a focus on using available information and provide a unique point of view to make investments risk-sensitive in the context of understanding and managing risks,

investing in resilience, and preparing for, responding to and recovering from crises provoked by natural and man-made hazards.

Our team helps governments, public sector organisations, cities and businesses:

• To develop a context specific DRR and DRM vision and strategy.

• To support practical transformations that enable achievement of vision and strategy.

• To develop a roadmap of concrete near term and long term actions to enhance the resilience of human-ecological-economic systems.

Implementing the Sendai Framework – next practical steps


Contacts Oz Ozturk ARISE Co-Chair Partner, PwC UK T: +44 7703 563 054 E: [email protected]

Melanie Butler Global Crisis Centre Global and Europe, Middle East and Africa Leader Partner, PwC UK T: +44 7801 216 737 E: [email protected]

Scott Williams Global Crisis Centre ARISE Global Director Director, PwC Switzerland T:+41 79 587 1671 E: [email protected]

Patrick Dahmen Global Crisis Centre ARISE Global Manager Manager, PwC Switzerland T: +41 79 794 1148 E: [email protected]

www.pwc.com

To confront and overcome crisis, you need expertise at every step – from preparing, to responding, to recovering. PwC’s Global Crisis Centre is a virtual centre of excellence made up of crisis specialists from different countries and industries. Our crisis teams can access and convene the best skills, experience and knowledge from across PwC’s network of member firms in 157 countries. We work with you to prepare for, respond to and recover from crisis. Find out more about how you can confront crisis with confidence by visiting us at www.pwc.com/crisis

This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.

© 2016 PwC. All rights reserved. PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.

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