Climate and Development

ISSN: 1756-5529 (Print) 1756-5537 (Online) Journal homepage: https://www.tandfonline.com/loi/tcld20

Concept of loss and damage of climate change –

a new challenge for climate decision-making? A
climate science perspective

Swenja Surminski & Ana Lopez

To cite this article: Swenja Surminski & Ana Lopez (2015) Concept of loss and damage of climate
change – a new challenge for climate decision-making? A climate science perspective, Climate and
Development, 7:3, 267-277, DOI: 10.1080/17565529.2014.934770

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Published online: 30 Jul 2014.

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Climate and Development, 2015
Vol. 7, No. 3, 267–277, http://dx.doi.org/10.1080/17565529.2014.934770

REVIEW ARTICLE
Concept of loss and damage of climate change – a new challenge for climate decision-making?
A climate science perspective
Swenja Surminski and Ana Lopez*

London School of Economics and Political Science, Grantham Research Institute on Climate Change and the Environment, Houghton
Street, London WC2A 2AE, UK
(Received 18 February 2013; final version received 27 March 2014)

Loss and damage (L&D) of climate change is a relatively new work stream of the international climate change regime.
Lacking a clear official definition, L&D has triggered a debate about framing the topic, incorporating technical aspects of
disaster risk reduction (DRR) and climate change adaptation as well as political considerations such as the idea of
compensation for vulnerable countries. This paper reviews the implications of L&D for decision-making with a special
focus on the role of climate science. We identify three broad policy goals embedded in the discussion: creating awareness
about the sensitivity of human and natural systems to climate change; developing risk reduction and risk management
approaches to enhance adaptation, reduce vulnerability and build resilience and informing compensation mechanisms. For
all of these, an understanding of the current and future climate-related L&D is needed. Existing decision-making
frameworks can help deal with uncertainties and avoid a ‘wait and see’ mentality for most L&D decisions. The
compensation component of L&D, however, offers a different dimension to the climate change discussion. While
recognizing the political and moral reasons driving the debate around compensation, an increased focus on the complex
and possibly unsolvable attribution question might put on hold efforts to integrate adaptation to climate change with wider
development aims and DRR, blocking necessary action.
Keywords: loss and damage; climate decision-making; uncertainty; climate change attribution

1. Introduction climate change victims within the international climate

The concept of loss and damage (L&D) of climate change
has emerged as one of the more recent work streams of the
international climate change regime. While initially being
promoted and debated by only a handful of experts, it
gained an official status within the United Nations Frame-
work Convention on Climate Change (UNFCCC) follow-
ing the adoption of the Cancún Adaptation Framework
(CAF), an outcome of the 16th session of the Conference
of Parties in 2010. The CAF highlights the need to
strengthen international cooperation and expertise to under-
stand and reduce L&D associated with the adverse effects
of climate change (UNFCCC, 2011a). This led to the
initiation of a new work programme on L&D by the Sub-
sidiary Body for Implementation. This process culminated
in the establishment, most recently at COP 19 in Warsaw, of
the ‘Warsaw international mechanism for loss and damage’
(UNFCCC, 2013). Heralded as one of the few achieve-
ments of the COP 19, this continues to bring attention to
the topic. While the Warsaw agreement suggests that
there is a growing acceptance of international support for
change policy community, it is also clear that there is no
common ground on compensation and liability for L&D.
At the same time, researchers and practitioners struggle
framing the idea of L&D from climate change, as a clear
official definition of L&D is lacking. The UNFCCC pro-
vides a baseline, but still leaves room for interpretation
(UNFCCC, 2012a). The topic is situated somewhere in
the sphere of climate change adaptation (CCA) and disaster
risk reduction (DRR), driven and dominated by a small
group of actors, while the wider climate change community
appears to have differing considerations about the scale and
relevance of this topic.
Some observers consider L&D as a predominantly pol-
itical construct, focused on the concept of compensation –
aimed at transferring funds to those who are experiencing
climate change L&Ds (Hyvarinen, 2012). Others seem to
see it as a more targeted approach of dealing with negative
climate change impacts embedded in the climate adaptation
methodology (Mechler, 2013), while yet other observers
highlight L&D as an approach for dealing with residual

*Corresponding author. Email: a.lopez@lse.ac.uk

© 2014 Taylor & Francis

268 S. Surminski and A. Lopez
risks, beyond mitigation and adaptation (Warner et al.,
2012).
Assessing and addressing L&D requires decisions to be
made – on a wide range of topics and at various levels of
governance, ranging from the global level, where
UNFCCC negotiators need to decide how to take this
topic forward, how to allocate funding and to establish
possible institutional frameworks around L&D, all the
way through to the local level, where communities need
to understand and manage changing risks.
All these aspects have to cope with data constraints and
uncertainty in climate and socio-economic trends, the pol-
itical framing and the lack of clear boundaries, as well as
the multi-dimensionality of establishing cause and effect
of climate change L&D. This creates challenges for
decision-makers at all levels and could potentially lead to
inactivity if not addressed properly.
While the topic of decision-making under uncertainty
has been receiving significant attention in the context of
CCA (Dessai & Hulme, 2007; Gilboa, 2009; Lempert,
2002; Lempert & Collins, 2007; Ranger, Millner, Lopez,
Ruta, & Hardiman, 2010b; Ranger et al., 2010a), it has
remained under-explored for L&D. In this paper, we aim
to fill this gap by discussing the role that existing
approaches to decision-making could play when addressing
each of the three policy goals embedded in the climate
change L&D discussion: creating awareness about the sen-
sitivity of human and natural systems to climate change;
developing risk reduction and risk management approaches
to enhance adaptation, reduce vulnerability and build resi-
lience, and informing compensation mechanisms.
We start by reviewing current knowledge of L&D,
reflecting on the existing efforts to frame it and on the tech-
nical challenges that have been identified in the literature.
We then discuss how climate science uncertainties and
limitations affect the assessment of risk and the impli-
cations of this for L&D decision-making. We conclude
with a commentary and outlook for the ongoing discussions
about L&D.
2. A review of the current L&D policy field
L&D of climate change officially entered the UNFCCC dis-
cussions in 2007,1 but the concept itself has a far longer
history. Growing awareness of the projected negative
impacts of climate change has been at the core of the emer-
ging mitigation and adaptation efforts. In the early adap-
tation literature, there was reference to the residual
impacts after mitigation and adaptation were carried out.
In this context, L&D associated with extreme events
appear as a demonstration of the limits to current levels of
adaptation (Smit, Burton, Klein, & Wandel, 2000; Smithers
& Smit, 1997).
At a policy level, efforts to formally address damages
related to climate change incurred by developing countries
can be traced back to 1991, when the Alliance of Small
Island States (AOSIS) proposed insurance, related actions
and compensation arrangements in the third session of
the Intergovernmental Negotiation Committee for a Frame-
work Convention (Millar, Gascoigne, & Caldwell, 2013).
Since then, there have been a relatively small but
growing number of stakeholders engaged in this area.
Those involved in the negotiations such as AOSIS, the
Least Developed Countries Group and national govern-
ments of vulnerable countries, such as Bangladesh, collab-
orate with think tanks and advocacy groups, such as
Munich Climate Insurance Initiative (MCII), German-
watch, the Overseas Development Institute and others2 –
producing reports, guidance notes and influencing the
negotiations.
The current climate change L&D literature offers input
to two broad aspects: the framing of L&D in the wider
context of CCA and DRR, and the identification of techni-
cal challenges for assessing and addressing L&D, including
questions of implementation.
2.1. The framing of L&D in the wider context of
CCA and DRR
There is wide agreement in the literature that climate change
L&D has not been properly framed and defined (see, e.g.
UNFCCC, 2012a, 2012b). While the same can be said
about the concept of adaptation (Schipper, 2006), the
unclear terminology and the multi-dimensionality of L&D
continue to invite a range of different interpretations. The
Bali Action Plan referred to ‘loss and damage associated
with climate change impacts in developing countries that
are particularly vulnerable to the adverse effects of climate
change’ (UNFCCC, 2008a). This was then specified in
more detail in the CAF – stating that approaches to address
L&D should consider climatic impacts, ‘including sea level
rise, increasing temperatures, ocean acidification, glacial
retreat and related impacts, salinization, land and forest degra-
dation, loss of biodiversity and desertification’ (UNFCCC,
2011a). A recent UNFCCC-commissioned literature review
on L&D approaches (UNFCCC, 2012b) uses the following
working definition of L&D: ‘the actual and/or potential mani-
festation of impacts associated with climate change in devel-
oping countries that negatively affect human and natural
systems’. Here, the impacts of climate change include those
caused by changes in intensity and frequency of extreme
weather events, as well as slow-onset events (such as mono-
tonic sea level rise) and the combinations of these two. It
differentiates between ‘loss’ (negative impacts in relation to
which reparation or restoration is impossible, such as loss
of freshwater resources) and ‘damage’ (negative impacts in
relation to which reparation or restoration is possible, such
as windstorm damage to the roof of a building or damage
to a coastal mangrove forest as a result of coastal surges)
(UNFCCC, 2012b).

Overall, we notice two different dimensions when
framing L&D of climate change: the technical concept,
which looks at tools and processes to assess and manage
risks, and the political dimension, where boundaries to
climate adaptation, compensation and equity play a role.
Linked to the political concept is the legal understanding
of L&D, asking for cause and liability of these impacts,
which might be relevant for agreeing funding of L&D
across the international community and deciding on poten-
tial compensation arrangements. The consideration of com-
pensation arrangements for climate change has a long
history – triggered by the emergence of early assessments
of the potential damages arising from climate change
(such as Ayres & Walter, 1991). The discourse has
evolved around different perspectives, e.g. compensation
can be considered in a legal context (see, e.g. Tol &
Verheyen, 2004) or in terms of financial arrangements (see
the discussion about insurance in Brown & Seck, 2013),
from a humanitarian perspective, in non-economic terms
or in the broader context of development (see Farber,
2008; Sprinz & von Bünau, 2013 for a more detailed dis-
course of climate compensation, as well as O’Brien et al.
(2012) for a reflection on compensation within the Intergo-
vernmental Panel on Climate Change (IPCC)’s work on
extreme events).
The technical dimension of L&D has its roots in the
general risk management methodology, based on a termi-
nology widely applied in DRR and more recently in
CCA. The UNFCCC (2012a) explores the terminology in
detail – highlighting different approaches to L&D as cur-
rently applied to DRR and CCA. Most broadly, ‘damage’
is seen as the physical impact and losses as monetized
values, which could be direct or indirect in the form of
economic follow-on effects (UNFCCC, 2012a). Here, the
focus is on categorizing, assessing and projecting impacts
of events – mainly in the context of disasters, but also in
the context of climate change implications for sudden-
onset and slow-onset impacts, over a range of time
scales, and including direct and indirect economic losses,
loss of lives and damage to and loss of eco-system services.
In the broader climate change context, L&D is often
described as the third cost element of climate change, as
outlined by Klein et al. (2007) (see also van Vuuren
et al., 2011): mitigation costs, adaptation costs and residual
damage. In this context, L&D is seen as addressing those
losses that are likely to occur despite adaptation and mitiga-
tion efforts. This academic exercise of framing L&D is
replicated among policy-makers – where different
interpretations of scope and concept are apparent among
UNFCCC Parties, as highlighted by Kreft (2012, p. 3):
Some Parties suggest that L&D is the residual risk when
mitigation is insufficient, and when the full potential of
adaptation is not met (Norway) while others frame L&D
as the residual after mitigation and adaptation choices
Climate and Development 269
have been made (Gambia). Ghana proposes that the
concept of loss and damage from the adverse effects of
climate be viewed as additional to adaptation focusing on
challenges of both identifying and addressing the instances
when adaptation is not longer possible. However, Bolivia
maintains that loss and damage from the adverse effects
of climate change concept is beyond adaptation, and as
such is additional to adaptation, focusing on challenges
of both identifying and addressing the instances when
adaptation is not longer possible.
In addition to the above, a small number of case studies
are emerging considering L&D in the context of certain
countries or social groups – e.g. the work of the Loss and
Damage in Vulnerable Countries Initiative, aimed at sup-
porting the international negotiations on L&D through
assessment of initiatives on the ground (see Shamsuddoha,
Roberts, Hasemann, & Roddick, 2013; Warner et al.,
2012).
2.2. The identification of technical challenges for
assessing and addressing L&D, including questions of
implementation
Beyond the efforts to frame L&D, most of the debate has
been on tools and approaches for assessing and addressing
L&D, in line with the thematic areas to be considered in the
implementation of the UNFCCC’s work programme
(UNFCCC 2011b):
(i) Assessing the risk of L&D associated with the
adverse effects of climate change and the current
knowledge on the same.
(ii) A range of approaches to address L&D associated
with the adverse effects of climate change, includ-
ing impacts related to extreme weather events and
slow-onset events, taking into consideration
experience at all levels.
(iii) The role of the Convention in enhancing the
implementation of approaches to address L&D
associated with the adverse effects of climate
change.
(Source: UNFCCC, 2011b).
Two recent UNFCCC reports (UNFCCC, 2012a,
2012b) highlight some technical challenges and limitations
for assessing and addressing L&D, such as the difficulties
of quantifying hazard and vulnerability, estimation of
climate-induced losses and the consideration of direct and
indirect losses, including non-monetary losses.
To inform decision-makers, the UNFCCC has commis-
sioned work to address these three areas.
The UNFCCC technical report 2012 (UNFCCC,
2012a) investigates tools and methods to assess L&D
risks (Thematic Area I). The report concludes with a list
of challenges when applying existing risk assessment for
270 S. Surminski and A. Lopez
L&D in vulnerable countries, namely data requirements,
capacity needs and applicability for decision-making.
The availability and access to underlying data, especially
for slow-onset events, is highlighted as a key challenge.
While for local-level assessments, the main gaps appear
to be in terms of hazard information, as climate change
projections have clear limitations, the report noted that
for the national level, the availability and applicability of
exposure and vulnerability data is a concern. The report
also highlights the capacity needs for conducting risk
assessments in developing countries, as most existing
tools and methods are ‘quite complex and require technical
skills and in-depth knowledge that have to be developed
especially in developing countries’. Pointing to a range of
limitations in approaches and tools, the report concludes
that ‘transparency in terms of limitations and uncertainties
of the models is important, as is clear communication with
the end-user community’ (UNFCCC, 2012a).
Overall, there appears to be growing agreement among
experts that an assessment of L&D requires the integration
of existing approaches from DRR and climate change risk
assessment (see, e,g. Hambira & Lesolle, 2011; IPCC,
2012).
There are a range of methods and tools currently used
outside the context of climate change that could be
applied to some of the L&D aspects. The IPCC’s SREX
report (IPCC, 2012) as well as UNISDR’s GAR (2011)
contains a range of examples. The second UNFCCC
report also focuses on the applicability of tools and
methods to address L&D (Thematic Area II) (UNFCCC,
2012b). The report assesses which approaches are appropri-
ate to address climate change L&D associated with increas-
ing weather-related extreme events and slow-onset events
now, and which approaches may be needed to address
L&D in the future. Reviewing existing approaches for
risk reduction, risk transfer and risk retention for Africa,
Latin America, Asia and Small Island Developing
States, the report highlights the importance of recognizing
time, scale and local as well as regional specifications when
determining which risk management approaches to apply.
For example, a range of existing approaches to manage
impacts of extreme events are unlikely to be applicable
for slow-onset events (UNFCCC, 2012c).
In order to determine how existing risk management
approaches could work in the context of L&D, a classifi-
cation of loss levels is often used, differentiating between
low, medium and high level risks, based on return
periods and/or scale of impacts as well as spatial and tem-
poral aspects (see, e.g. MCII, 2012). This is in recognition
that the effectiveness of management tools varies with the
scale of the risks. For example, some management tools,
such as insurance, may only be suitable for current- to
short-term risks (Mechler et al., 2009).
Any assessment of L&D from climate change needs to
incorporate two key components: the information about the
climatic hazard, including current climatic variability and
possible future climatic changes, and information about
the vulnerability and exposure. A significant challenge
for L&D is then the uncertainty in this information,
which does not just stem from climate change; the actual
losses and damages are often heavily determined by the
vulnerability and exposure (IPCC, 2012). In fact, the
climate dimension just adds to the uncertainty derived
from the wide range of socio-economic and environmental
factors considered, often referred to as the ’cascade of
uncertainty’ (Schneider, 1983) or the ’uncertainty
explosion’ (Henderson-Sellers, 1993).
3. L&D from a science point of view – the
challenges of assessing the risk.
Risk is a function of hazard, exposure and vulnerability.
Therefore, any attempt of assessing the risk of L&Ds
from climate change needs to incorporate two key com-
ponents and illustrate their interplay: data on vulnerability
and exposure, as well as information on the climatic
hazard, including current climatic variability and future,
long-term projections. (UNFCCC, 2008b, 2012a). From a
climate science perspective, the focus is traditionally on
the hazard side of risks, but there is now a growing recog-
nition that data needs and limitations for vulnerability and
exposure assessments are equally important for understand-
ing climate change risks.
IPCC’s SREX concluded with high confidence that
increasing exposure of people and economic assets has
been the major cause of long-term increases in economic
losses from weather- and climate-related disasters,
arguing that the development pathways of a country or
community do influence exposure and vulnerability
(IPCC, 2012). But understanding the ‘multi-faceted
nature’ (IPCC, 2012) of both exposure and vulnerability
is still a challenge, due to data limitations and the inherent
uncertainty in socio-economic trends (GAR, 2011). The
data required for assessing vulnerability and exposure
vary, depending on scope and context. It can include his-
torical loss information, property databases, demographic
data and macroeconomic data, such as debt and fiscal
budgets (UNFCCC, 2012a). In addition, there are the intan-
gibly aspects of L&D, which are not valued by markets and
therefore are often left out of any assessments. The ability
to capture direct and indirect losses is also identified as a
key challenge, as highlighted at the 36th SIB meeting in
May 2012, where it was noted that available estimates on
losses typically lack numbers on non-economic losses,
such as culture and heritage (UNFCCC, 2012d).
Government asset databases or sectorial disaster loss
data are not available in all countries, or it may be very
limited in scope, not capturing those intangible impacts
(Mechler et al., 2009). This makes assumptions and extra-
polations necessary, which add to the degree of uncertainty

for L&D assessments. A further limitation to current under-
standing of exposure and vulnerability interplay stems from
the fact that the majority of existing risk assessment tools
and methods only examine the status quo without reflecting
on the role of future trends, e.g. in urbanization, poverty or
social cohesion (Bouwer, 2013; UNFCCC, 2012a).
The information about the climate hazard relates to the
physical phenomena, such as large cyclonic storms or long-
term reductions in precipitation, and some of their conse-
quences, such as flooding or water resources system
failure. This hazard information constitutes the input to
estimate the magnitude and frequency of damaging meteor-
ological events in DRR approaches, or future projections of
climate risks to inform CCA. From the (physical) science
point of view, there are challenges to estimate the hazard
part of the total risk common to all interpretations of L&D.
To evaluate the current and changing likelihood of cli-
matic hazards, different sources of information are
employed (IPCC, 2007a, 2007b, 2012). Historical records
of climate variables, such as temperature or precipitation,
are used to estimate current climate variability. Estimates
of changes of these variables in the future are provided
by climate models. Impact models are then employed to
evaluate how changes in climatic variables will produce
changes in particular natural or human systems, e.g. how
changes in precipitation patterns will affect flood regimes
in a given catchment.
Historical records must be accurate, representative,
homogeneous and of sufficient length if they are to
provide useful statistics. The value of the inferences
depends on the data representing the range of possible
values occurring over time. Availability and quality of
data can induce large uncertainties in the estimation of
current climatic hazards. While data for temperature and
precipitation are widely available, other variables such as
soil moisture are poorly monitored or extreme wind
speeds are not monitored with sufficient spatial resolution.
Palaeoclimatology can provide information about rare,
large magnitude events in places where long enough obser-
vational records are not available and good proxies to esti-
mate the magnitude of past events such as floods or
droughts can be found. Palaeodata often illustrate the fact
that, in many cases, the recent observational records
provide very limited information about the range of the
unforced natural variability in a particular location, allow-
ing for testing the robustness of the systems under consider-
ation even before human-induced climate change is taken
into account (Benito et al., 2004).
Projections of changes in future climate are based on
climate model simulations. Even though the physical and
chemical processes in the climate system follow known
scientific laws, the complexity of the system implies that
many simplifications and approximations have to be
made when modelling the system. The choice of approxi-
mations creates a variety of physical climate models
Climate and Development 271
(IPCC, 2007a). There are different sources of uncertainties
in climate model projections. Climate forcing or scenario
uncertainty is introduced by the fact that to simulate
future climate, the models are run using different scenarios
of anthropogenic forcings that represent plausible but
inherently unknowable future socio-economic develop-
ment (IPCC, 2000; Moss et al., 2008). Climate model
and climate variability uncertainties are due to our incom-
plete knowledge of the climate system, the limitations of
computer models to simulate it and the system’s nonlinear-
ity (Knutti et al., 2007; Stainforth, Allen, Tredger, & Smith,
2007). The relative and absolute importance of these differ-
ent sources of uncertainty depends on the spatial scale, the
lead-time of the projection and the variable of interest
(Booth et al., 2013; Hawkins & Sutton, 2009). At shorter
time scales, in many cases, the current natural variability
of the climate system and other non-climatic drivers of
risks will have a higher impact than the climatic changes
driven by changes in atmospheric concentrations of green-
house gases. For example, in the near term, and under
current climate variability, changes in exposure such as
urbanization and building housing developments in flood-
prone areas could increase significantly the risk of flooding
and damage to the aforementioned infrastructure, indepen-
dently of climate change. Over longer time scales, it is
expected that anthropogenic climate change might play a
more significant role.
It is clear then that any strategy adopted to manage
climate hazards has to take into account the large uncertain-
ties in climate projections and, even more importantly,
acknowledge that in many cases, particularly at local
scales, current modelling tools to generate projections
cannot produce reliable and robust estimates of future
changes (Oreskes, Stainsforth, & Smith, 2010; Risby &
O’Kane, 2011).
While global climate models (GCMs) simulate the
entire Earth with a relatively coarse spatial resolution
(e.g. they can capture features with scales of a hundred kilo-
metres or larger), regional climate projections downscaled
from GCMs have a much higher resolution (simulating fea-
tures with scales as small as a few kilometres). Downscal-
ing can be accomplished through one of two techniques:
‘dynamical’ or ‘statistical’ downscaling (Wilby et al.,
2009). ‘Dynamical’ downscaling refers to the process of
nesting high resolution regional climate models within a
global model, while ‘statistical’ downscaling relies on
using statistical relationships between large-scale atmos-
pheric variables and regional climate (often at the station
level) to generate projections of future local climatic con-
ditions. Downscaling approaches do not provide magical
fixes to possible limitations in the data being downscaled
(Kerr, 2011). In fact, the downscaling approach will only
introduce one more source of uncertainty and/or ignorance
in the resulting output. In this case, the generation of
climate projections using downscaling techniques will
272 S. Surminski and A. Lopez
almost certainly increase the level of uncertainty in the
original GCM projections, having significant effects in
the estimation of probabilities of occurrence of damaging
events in DRR models and climate change risk
assessments.
Climate model projections provide information about
climate variables, such as temperature, precipitation, sea
level, etc. However, a climate risk assessment involves
understanding how changes in these variables will affect
particular natural or human systems. In some cases, such
as with heat waves, changes in temperature are the only
information needed to estimate the climatic hazard. In
other cases, such as floods, an intermediate modelling
step is required. This step is carried out by impact
models, which are computational models that take as
inputs observed or simulated climate variables, such as
temperature, precipitation, soil moisture content, wind
speed, etc. and use them to simulate the variables that are
relevant to analyse a particular climate impact (IPCC,
2007b, 2012). For instance, extreme rainfall events can
cause floods. But to estimate the extent of the flooded
area, a storm water management model is used to generate
the flood footprint for each particular event (Ranger et al.,
2011). The limitations of impact models are similar to some
of the limitations of climate models: poor representation of
the physical processes involved, calibration issues and
computational constraints all contribute to compounding
the uncertainties in the climate inputs with the uncertainties
in the impact model outputs.
In summary, a comprehensive modelling approach to
assess climate change-induced hazards requires com-
bined simulation of all the domains. For flood risk, for
instance, it requires the modelling of the atmosphere
and ocean, catchment river network, flood plains and
indirectly affected areas. As discussed above, consider-
able uncertainty is introduced into each of the modelling
steps involved, including uncertainties about the
greenhouse gas emission scenarios, the representation
of physical processes in the GCM, the characterization
of natural variability, the method of downscaling to
catchment scales and in hydrological model structure
and parameterizations.
Therefore, the uncertainty associated with a complete
model chain is large, particularly at the scale relevant for
decision-making. Moreover, if the goal is to estimate the
residual likelihood of the climate hazard after mitigation
and adaptation, there will be one more link in the chain
of uncertainties (Henderson-Sellers, 1993; Schneider,
1983), namely the possible adaptation pathways and the
uncertainties associated with them, for instance, how
changes in exposure and vulnerability triggered by the
adopted options might feedback into the climate and
societal systems.
For L&D assessment, it is therefore important to
develop and integrate vulnerability and exposure scenarios
with climate scenarios (Birkmann, Chang Seng, & Krause,
2011). Recently suggested ways forward focus on the need
to integrate all components of risks, including an upgrading
of vulnerability and exposure assessments (Huggel, Sone,
Auffhammer, & Hansen, 2013; Stern et al., 2013).
The above discussion about the estimation of the
climate hazard is closely related to and based on similar dis-
cussions within CCA. However, L&D also brings some-
thing distinctly unique to the discussion: embedded in the
political concept of L&D is the element of compensation,
which requires the possibility of estimating the attributable
fraction of losses and damages to human-induced climate
change. Estimations of the future likelihood of a climatic
hazard do not, a priori, have any information about
whether or not the event can be attributed3 to human-
induced climate change. Since the climate varies continu-
ously at all time scales, and usually there are many causal
factors underlying an extreme event, attribution of particu-
lar weather events is very difficult; there is always the
possibility that the event might have occurred even in the
absence of human-induced climate change, especially in
the case of current or near-term future impacts. Recently,
new approaches have been developed that attempt to quan-
tify the attributable part of the changing meteorological
risk, or in other words, what is the change in the probability
of occurrence of a given weather event due to human influ-
ences on the climate system (Pall et al., 2011; Peterson,
Stott, & Herring, 2012; Stott, Stone, & Allen, 2004).
These approaches rely heavily on climate models to
compare how the likelihood of the weather event changes
with and without the influence of anthropogenic emissions
of greenhouse gases. Clearly, this requires the models to be
able to simulate correctly both scenarios. However, as it has
been discussed already, climate models have significant
limitations to simulate the climate at the scales relevant
for extreme meteorological events (Trenberth, 2012;
Trenberth & Fasullo, 2012) and the climate system tele-
connections that could explain the extreme magnitude or
persistence of some events (Trenberth & Fasullo, 2012).
Moreover, the estimated changes in likelihoods rely on
climate model simulations that cannot be directly validated
against observations (Allen et al., 2007). Therefore, these
probabilities can only be subjective Bayesian probabilities
that reflect judgement about uncertainties in climate model
experiments rather than robust estimates of the attributable
part of changing climatic risks (Hulme, O’Neil, & Dessai,
2011).
4. Challenges for decision-makers
L&D – both as a political concept and in its technical
dimension will require decisions to be made at different
scales from local to global, and by a range of stakeholders.
We propose three categories of decision-making goals for
L&D:

. To create awareness about the sensitivity of human
and natural systems to climate and the need to
respond with appropriate mitigation, adaptation and
DRR policies (UNFCCC, 2012d).
. To develop risk reduction and risk management
responses, with the goal to enhance adaptation to
reduce vulnerability and build resilience; in this
case, the evaluation of climate risk is a necessary
component of any adaptation options appraisal.
This category has many analogies with CCA and
DRR, asking how to assess and how to respond to
risks.
. To inform compensation arrangements for L&D.
For all these, an understanding of the current and future
scale and distribution of climate-related L&D is fundamen-
tal. As noted above, decision-makers are faced with uncer-
tainties related to hazard, exposure and vulnerability. For
some, this may prove as a potentially welcome excuse for
inaction, for others this might lead to misdirected compu-
tation and data-collection exercise or to heated, almost
unresolvable disputes about the underlying science. Can
this potential paralysation (Dessai, Hulme, Lempert, &
Pielke, 2009) be avoided? The ability to make L&D
decisions depends on skills and know-how for assessing
the risks and institutional capacity as well as funding to
address it (UNFCCC, 2012a). But given the large uncer-
tainties inherent to the estimation of risk, the use of a
decision-making framework that can make the best use of
the available information to develop strategies to reduce
L&D is also the key.
In recent years, two decision-making frameworks have
been developed in the context of CCA: the ‘top-down (or
science-driven)’ and the ‘bottom-up (or policy-driven)’
frameworks.
The first framework focuses on climate modelling
information, often downscaled, to project the impacts of
climate change and then derives policies in response to
these impacts. This approach has been criticized for its
heavy reliance on climate projections that are limited in
their ability to represent key drivers of extreme events
and are not generally fit for the purpose of decision
support (IPCC, 2012; Smith & Stern, 2011; Stainforth
et al., 2007), and for the potential lack of robustness of
the projected impacts due to different methodological
issues (Hall, 2007; Merz, Hall, Disse, & Schumann,
2010; Tebaldi & Knutti, 2007).
The second framework is based on risk management
approaches that start by defining the policy or adaptation
goal and consider the climatic component as just one part
of the whole risk faced by the system (Ranger et al.,
2010a, 2010b; Willows, Reynard, Meadowcroft, &
Connell, 2003). The starting point, which consists of the
definition of the particular problem/decision to be
addressed, includes identifying present and future climatic
Climate and Development 273
and non-climatic risks that make the system vulnerable,
identifying institutional and regulatory constraints and
identifying the possible options.
In the context of L&D, the goal could be to reduce the
risk of L&D resulting from particular extreme events to tol-
erable levels and plan the management of the residual risk
that cannot be minimized. The uncertainty in the risk infor-
mation available and the prospect of this information chan-
ging in the future will require from decision-makers the
need to design flexible adaptation and management path-
ways that allow for periodic adjustments as new infor-
mation becomes available, and the possibility of changing
to new routes when or if incremental adjustments are no
longer considered sufficient according to the evidence
available at the time (Hallegatte, 2009; Hulme, Pielke, &
Dessai, 2009; Lopez, Wilby, Fung, & New, 2010; Wilby
& Dessai, 2010).
It is clear that there are fundamental differences
between the two decision-making frameworks described
above. When we explore the relevance of these two
decision-making frameworks for L&D, the following
picture emerges: their application in the context of the
L&D debate depends on the intended goal.
The top-down approach appears most relevant for the
first goal, when the exercise of mapping climate change
impacts aims to create awareness about the plausible
climate change losses and damages in order to trigger
policy responses (mitigation, adaptation and DRR).
For the second L&D goal, there is a strong parallel with
the CCA problem: how to minimize the climate change risk
to tolerable levels, and what are the options to manage what
cannot be minimized. In this sense, the challenges pre-
sented by the need to reduce and manage climate change
L&D are not very different to the ones presented by the
need to adapt to climate change and variability. When
thinking about estimation of L&D as a tool to plan for
the management of the residual risk (with or without suc-
cessful mitigation and previous adaptation), the ‘policy
first’ approach appears as the adequate framework to
address this question.
Finally, as already mentioned, the third dimension of
the decision-making relevance of L&D assessments lies
in the context of attribution of damages to the incremental
risk caused by anthropogenic climate change. For this to be
possible, the incremental fraction of L&D that can be
attributable to anthropogenic climate change would need
to be computable. From the point of view of the
decision-making frameworks discussed above, this is
very much a ’science first’ approach with the extra require-
ment of a simulation of the counter factual world, i.e. an
estimation of the likelihood of the event had greenhouse
gas concentrations not increased during the last hundred
years or so. As discussed in Section 3, the estimation of
the attributable, incremental risk presents serious chal-
lenges. Some climate scientists argue that the science of
274 S. Surminski and A. Lopez
attribution of climate events could support decisions related
to obtaining compensation for damages caused by attribu-
table natural disasters, since it potentially allows the
ability to distinguish between genuine consequences of
anthropogenic climate change from climate events that
are a result of internal climate variability (Hoegh-Guldberg
et al., 2011; Peterson et al., 2012). Other authors (Hulme
et al., 2011) challenge the idea that the science of
weather event attribution has a role to play in this
context, in particular due to the fact that the estimated
changes in attributable risks are based on climate modelling
experiments which cannot provide robust answers. There-
fore, relying on them to make decisions about economic
compensation could be misleading. While clearly relevant
for the compensation aspect of L&D, the search for evi-
dence of the causal link, particularly in the context of
single events, could lead back to a so-called ‘physicalist
interpretation of disasters’ (Hewitt, 1995), and distract
from the importance of recognizing risks in its totality
(Huggel et al., 2013). This might put on hold efforts to inte-
grate climate change with wider development aims and
DRR.
5. Conclusions
The different dimensions of L&D of climate change make
this a complex topic, with a range of interpretations,
approaches and responses being considered, while the pol-
itical negotiations are in full flow. Reflecting on the current
state of discussion, we draw the following conclusions.
To date, there are no easy answers to the L&D chal-
lenges. This is not only due to technical and science limit-
ations, but also due to the political dimension and the
uncertainties inherent in this process. Lacking a clear defi-
nition of L&D does not help either.
L&D of climate change is a political concept, with its
technical roots in CCA and DRR. Most of the components
suggested under the UNFCCC work programme are well
embedded in ongoing efforts within climate adaptation
and DRR. As stated, there are a wide range of tools and
approaches from the fields of CCA and DRR that can
help responding to L&D, particularly for extreme events.
This therefore underlines the importance of holistic
approaches, incorporating hazard, vulnerability and
exposure elements of risk. In this context, the recognition
of the importance of data for all three risk aspects is impor-
tant, and there are some clear shortcomings in terms of
accessibility, availability and quality of risk data for all
three components.
Climate science provides the foundation for the L&D of
climate change discussions. Therefore, recognition of limit-
ations and uncertainty is important, particularly for those
who will make decisions around L&D. In a similar way,
limitations with regard to loss assessments and accounting
for indirect consequences as well as estimating socio-
economic risk drivers exist and those involved in L&D
need to understand and embrace those challenges.
How we respond to these challenges and limitations
depends on the specific goals and aims associated with
L&D. We can identify three goals embedded in the L&D
discussion:
. create awareness about the sensitivity of human and
natural systems to climate, and the need to respond
with appropriate mitigation, adaptation and DRR
policies;
. support risk reduction and risk management, with the
goal to enhance adaptation to reduce vulnerability
and build resilience and
. inform compensation mechanisms.
The first two goals are common to the CCA and DRR
discussions, and lessons learnt in those areas can be
shared here. The lack of data and knowledge should not
be seen as a reason for delaying action – in fact, there are
a range of existing instruments and tools that can be
applied to assess and manage current and future L&D. As
previously discussed, within the CCA community, tools
and approaches have recently been developed to deal
with uncertainty from climate science in order to avoid a
‘wait and see’ mentality for decision-making. These can
be applied to most of the L&D decision-making, in the
same way as suggested for CCA. In this context, the chal-
lenges presented by the need to reduce and manage climate
change L&D are not very different from the ones presented
by the need to adapt to climate change and variability.
The compensation component of L&D, however, offers
a different dimension to the climate change discussion.
While not explicitly outlined in the official UNFCCC
language, this is an underlying aim that has been driving
the L&D debate since its beginnings. The focus on com-
pensation for those climate impacts that are beyond mitiga-
tion and adaptation’s reach poses some additional
challenges for decision-makers – particularly in the
context of the underlying science. Approaches used to esti-
mate the attributable part of the risk of L&D to human-
induced climate change are highly debated within the
science community.
On the other hand, the majority of the climate change
experts (as reflected by the last chapters of IPCC, 2012)
seem to have come to the conclusion that the only way to
deal with climate change is to take a holistic approach to
risk management. From the adaptation and DRR perspec-
tive, the causation question is less important. However,
the idea of L&D for compensation could require a break
with this approach and might trigger increased efforts to
dissect the human-induced climate change part of the risk.
While valid political and moral reasons drive the debate
around compensation, an increased focus on the complex
and possibly unsolvable attribution question might put on

hold the efforts to integrate adaptation to climate change
with wider development aims and DRR.
Acknowledgements
This research was supported by the LSE’s Grantham Research
Institute on Climate Change and the Environment and the
ESRC Centre for Climate Change Economics and Policy,
funded by the Economic and Social Research Council and
Munich Re.
Notes
1. Loss and damage as a concept was established at negotiations
at the 13th COP in Bali in 2007, which called for consider-
ation of ‘disaster risk reduction strategies and means to
address loss and damage associated with climate change
impacts in vulnerable countries’ (UNFCCC, 2008a. Para 1
(c)(iii)).
2. Others include the Climate and Development Knowledge
Network, the European Capacity Building Initiative, the
Third World Network and the International Centre for
Climate Change and Development.
3. Detection of climate change is the process of demonstrating
that climate has changed in some defined statistical sense,
without providing a reason for that change. Attribution of
causes of climate change is the process of establishing the
most likely causes for the detected change, either natural or
anthropogenic, with some defined level of confidence
(source: IPCC, 2012).
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