You would think at a time when the world is aware of the effects of climate change, that companies would be getting ready with some risk analysis. Think again.

A new report from the Economist Intelligence Unit shows that companies are struggling to get their heads around environmental risk. The report, Under the spotlight: The transition of environmental risk management, shows that environmental risk management is frequently managed in an ad hoc fashion and no-one is really sure who should be responsible for environmental risk. It also reveals that companies conduct strategic activities without a formal assessment of environmental risk and that environmental risks associated with suppliers and partners are key area of weakness.

The biggest obstacles to proper environmental risk management are a lack of certainty about the impact of environmental liabilities and about the future scope of legislation.