Age
Thursday 1/2/2007 Page: 8
Rachel Kleinman talks to a scientist who's taking climate change to business.
IT WAS the late 1980s, and a young man from Manchester was working through the night, cocooned in a nuclear physics complex that straddled the French-Swiss border. Fresh from Liverpool University, Karl Mallon had accepted a scholarship at Geneva's prestigious European Centre for Nuclear Research and his career path seemed assured. That is, until he became increasingly unsettled by a nagging question.
Should nuclear physicists take any responsibility for the future use of the technology? Or was it OK to develop knowledge for knowledge's sake and not worry about the consequences? Unconvinced, he swapped nuclear physics for a Melbourne University Phd on fluid dynamic energy, including wind power. "I worked with utility companies on how to manage alternative energy sources - it was the early days of green power, if you like," Dr Mallon says.
Dr Mallon completed his doctorate in the run-up to the 1997 Kyoto Protocol - and his career has since fused with the climate debate. Last year, he and business partner Gareth Johnson set up Climate Risk, advising the commercial sector on risk management measures to minimise the economic impact of climate change.
"The focus up till now has been is it affordable to fix it?' Dr Mallon says. "But there has been very little information about the cost of not fixing the problem. That came as quite a shock (to me) but also a startling opportunity.
"That was the impetus behind starting Climate Risk - to build the bridge between climate change science and the economy or commercial sector." Insurance companies, which operate exclusively on risk factors, are already standing to attention, Dr Mallon says.
People are buying homes, making life-long decisions, on the assumption that the world will be the same in 10 or 20 years. But scientists working in climate change are fully comfortable with the knowledge that it won't be the same, so there is a disconnect between the two," he says.
"Imagine you are going off to buy a great house on the coast and the mortgage lender wants you to get insurance.
You say: `I can get insurance but it is not covered for flood.' And the bank says: No way, it is a coastal area, we won't lend on that property.' " British research shows property drops about 80 per cent of its value when it is uninsurable, Dr Mallon says. Somewhere, not too far down the track, people are going to start suing over such issues.
"It is like when there was eventually sufficient proof to say smoking kills you or asbestos causes cancer," he says. "We are now at that point where we can say `climate change is actually happening'. "The climate debate has been so political - all about left versus right or business versus greens.
"But climate impacts are completely apolitical. They are coming, they are here and they are going to get worse." Dr Mallon says business is quickly realising it must set the politics aside and get on with managing the risks or risk being sued by investors for not being on top of the issue.
"This is straight business. It is about investment, risk, liability and accountability." But Dr Mallon, an acute combination of businessman and scientist, wants to focus on the opportunities as well as the risks.
"For example, where will we build retirement homes?" He says Queensland might not be such an appealing retirement playground if temperatures rise. "Heatwaves are killers for elderly people," he explains.
"So do we expect that will be a great place to retire in the future? Probably not. South-east Victoria and Tasmania might be better." Climate change would affect every business from coal-fired power stations to soft drink manufacturers, he said. "It is as grand and as mundane as that."
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