Impact of Global Warming on Business and Environment

Running Head: ACCOUNTING THEORY 0
Accounting theory
Global Warming

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The global warming also referred to as the climate change which is observed in the
Earth’s Climate system and its related effects. The current increase in the temperature of the
Earth’s surface as well as its atmosphere is called as the global warming. Average temperature
around the world has risen by 0.75C over the last 100 years. Mostly it has been observed that
about two thirds of this increase has occurred since the year 1975. The average temperature
changed and the activities such as burning of the fossil fuels and the deforestation are the key
drivers in the occurrence of the global warming (Whats your impact, 2018).
Climate change is an imperative change in the statistical distribution of the pattern of the
weather which ranges from decades to million years. The extreme climate such as the global
warming, floods, hurricanes earthquakes and a lot more are the superior sources that affect the
business with greater force (Novy-Marx, 2014). What other things that are affected in the
business are the firm’s reputation, legal responsibilities, regulatory obligation, reporting of the
financial statements, and also supply chains can be affected drastically. Climate change is
basically dependent in two situations. First the natural changes like flood, soil erosion landslide,
rainfall and a lot more. Second the artificial changes like manufacturing industries which are the
causing a lot of pollution and wastage form the various industries. Businesses that are there for
the long term purposes and which are dependent on the long term investment are likely to have
an adverse impact such as for example in case of Nepal, due to the high temperature and the
humidity there was a discomfort faced by the employees and they were not able to work due to
suffocation and heat. The global warming resulted into landslides and soil erosion (Chandler,
2018). Looking out the tourism business global warming affects the ecosystem services and it
affects the business in such a way that the agriculture products are damaged and the fisheries are
affected. The company which is engaged in the business of the energy production and the

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intensive sectors need to reduce the carbon emission level which in fact gives the boost to the
additional global warming. This in turn is a heavy capital expenditure for the company (Burke,
Hsiang & Miguel, 2015).
The impact on the environment is relatively different from that on the business. On an
average the precipitation has increased globally over the last century in almost all the areas of the
world. In other words, regions which are dry at present will in general become even drier, while
regions that are currently wet will in general become even wetter (Moore & Diaz, 2015). The
temperature over the ocean has been increased suddenly and on the hand the glaciers are melting
which ultimately gives rise to the increase in temperature. Moreover the human activities have
also contributed in a major way such as burning of the fossil fuels and increases the GHGs in the
atmosphere. Another human influence is the emission of the Sulfur dioxide which is the drivers
of the formation of the sulfate aerosols in the atmosphere.
The environmental issues are nowadays becoming quite severe because of increasing
impact of industrialization and urbanization. These issues have demanded significant attention
across the world due to their adverse impacts. Waste disposal, climate change, pollution are few
of those environmental challenges that are commonly faced by various constituents of the eco-
system (Gov.UK, 2015). In the recent era, different institutions have been developed to address
the environmental matters. Also, economic instruments and approaches have been introduced by
the governmental bodies for the business organizations so as to protect the environment by
promoting the ways of clean production. Further, many environmental and legal regulations have
been brought in existence to control those activities of various industries that directly or
indirectly contributes to environmental destruction.