Sustainability and Climate Risk (SCR) — Question 37

After recent summer and winter temperature extremes disrupt operations, a national oil company evaluates its 10-year business plan. The risk department reviews how corporate assets, both physical and human, are resilient to climate change. Early in the planning process, a risk team member emphasizes the importance of planning for both acute and chronic climate hazards.
How should the team member describe acute and chronic hazards in terms of the 10-year strategy?

Answer options

• A. When determining locations for future production facilities, modeling shifts in climate requires more data on local conditions than modeling changes in wildfire prevalence.
• B. When assessing climate impacts on facility worker productivity, the frequency of heatwaves influences average temperature.
• C. When assessing climate impacts on offshore drilling operations, models of hurricane damage agree more than models of sea level rise.
• D. When considering climate impacts on onshore assets, flood projections are more accurate than mean precipitation change projections.

Correct answer: C

Explanation

The correct answer is C because it highlights the acute hazard of hurricanes, which can cause immediate and severe damage to offshore drilling operations, unlike the chronic hazard of sea level rise that may have long-term effects. Options A and B focus on different aspects of climate modeling and impacts that do not directly illustrate acute versus chronic hazards. Option D presents a comparison of accuracy in forecasting but does not effectively differentiate between acute and chronic impacts.