Climate Resilience:

Actions Needed to Ensure DOD Considers Climate Risks to Contractors as Part of Acquisition, Supply, and Risk Assessment

GAO-20-511: Published: Jun 25, 2020. Publicly Released: Jul 27, 2020.

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The Department of Defense relies on contracted goods and services to carry out missions. Since 2010, DOD has identified climate change as a threat to its operations and installations.

Climate effects can damage infrastructure—for example, flooding can damage roads or electrical infrastructure—in turn delaying critical goods like food or services like information technology. However, DOD hasn’t routinely assessed how climate change or extreme weather risks could affect its contractors and its access to goods and services.

We recommended, among other things, incorporating climate resilience into military acquisition and supply guidance.

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Additional Materials:

Contact:

Elizabeth A. Field
(202) 512-2775
fielde1@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

What GAO Found

The Department of Defense (DOD) has not routinely assessed climate-related risks faced by its contractors as part of its acquisition and supply processes, through which DOD obtains contracted goods and services. DOD's acquisition process includes long-term planning activities such as life-cycle sustainment planning. Its supply chain process includes steps to identify and assess potential disruptions, such as severe storms affecting transportation or energy systems, in order to mitigate risk. However, these processes in general do not systematically identify and consider climate-related risks to materiel acquisition and supply or the acquisition of weapon systems, according to Office of the Secretary of Defense (OSD) and military department officials. DOD's climate change adaptation directive indicates that OSD and the military departments should include climate considerations in acquisition and supply and integrate those considerations into relevant policy and guidance.

However, GAO's review of DOD and military department guidance on acquisition and supply found that the guidance did not implement DOD's climate change directive by including consideration of climate change or extreme weather. Until DOD and the military departments include these considerations in their guidance on acquisition and supply chain processes, they risk continuing to develop acquisition strategies and managing supply chains without building climate resilience into these processes and potentially jeopardizing their missions.

DOD guidance requires consideration of climate-related risks as part of the mission assurance process, when appropriate. However, GAO found that the department has not assessed risks—including those associated with climate change or extreme weather—to commercially owned facilities, which can support DOD installations as well as weapon systems, as part of this process. Assessing risks to commercial facilities has been a longstanding challenge for DOD, with the department noting in 2012 that it had paid inadequate attention to challenges outside of DOD-owned facilities and citing a limited understanding of supply chain risks as a pervasive problem. DOD's mission assurance guidance includes minimum requirements for assessments of certain non-DOD-owned facilities, such as completion of an all-hazards threat assessment. However, DOD officials stated that they had not conducted such assessments.

The officials noted that DOD is limited in its ability to conduct such assessments, as it does not have the same access to commercial facilities as it does to its own facilities. While DOD officials stated that they are exploring alternative ways of assessing risks to commercial facilities, they noted that these efforts are in the early stages. Without determining what approaches may be feasible for assessing risks to commercial facilities as part of the mission assurance process and issuing or updating guidance accordingly, DOD may not fully evaluate the risks to critical commercial facilities as part of the mission assurance process, leaving gaps in its knowledge of potential risks—to include climate and weather-related risks—to its ability to fulfill key missions dependent on such facilities.

Why GAO Did This Study

Since 2010, DOD has identified climate change as a threat to its operations and installations. The department relies on contracted goods and services for its mission and installations. Climate change is projected to have broad effects that could affect DOD's supply chains, and any associated risks to contractors can have an impact on DOD. One way DOD assesses risk to its missions is through mission assurance, which is a process to protect or ensure the function of capabilities and assets critical to its missions.

GAO was asked to review potential threats to national security from the effects of climate change on defense contractors. GAO examined the extent to which DOD assesses the potential effects on its operations from climate change and extreme weather risks faced by its contractors through the department's (1) acquisition and supply processes, and (2) mission assurance process. GAO reviewed DOD acquisition, supply, and mission assurance documents and interviewed relevant DOD officials and contractor representatives.

What GAO Recommends

GAO is making six recommendations, including that DOD incorporate climate adaptation into its acquisition and supply guidance and issue or update guidance on mission assurance-related assessments for commercial facilities. DOD concurred with three recommendations and partially concurred with three. GAO continues to believe that DOD should fully implement its recommendations.

For more information, contact Elizabeth A. Field at (202) 512-2775 or fielde1@gao.gov.

Recommendations for Executive Action

  1. Status: Open

    Comments: DOD partially concurred with this recommendation. In its response, the department noted that the Under Secretary of Defense for Acquisition and Sustainment will oversee updates to relevant guidance related to supply processes and that they anticipate the updates to be complete by May 31, 2021. The department further noted that the Under Secretary of Defense for Acquisition and Sustainment will ensure updates are made to the acquisition policies, when and if appropriate. However, the department stated that its Adaptive Acquisition Framework currently provides all of the necessary flexibility required. We will continue to monitor the status of this recommendation.

    Recommendation: The Secretary of Defense should ensure that the Under Secretary of Defense for Acquisition and Sustainment implements DOD Directive 4715.21 on climate change adaptation and resilience by updating, as appropriate, relevant DOD guidance related to acquisition and supply processes to incorporate the directive's provisions pertaining to those processes. In doing so, the Under Secretary of Defense for Acquisition and Sustainment should consider providing guidance as to how departmental officials may leverage already existing information regarding private companies. (Recommendation 1)

    Agency Affected: Department of Defense

  2. Status: Open

    Comments: DOD concurred with this recommendation. In its response, the department noted that the Army would update, as appropriate, Army guidance related to acquisition and supply upon updates to DOD's climate adaptation directive and other applicable DOD or federal regulations. However, DOD noted that it does not plan to update its acquisition guidance in response to our recommendation that DOD do so. We will continue to monitor the status of this recommendation.

    Recommendation: The Secretary of the Army should implement DOD Directive 4715.21 on climate change adaptation and resilience by updating, as appropriate, relevant Department of the Army guidance related to acquisition and supply processes to incorporate the directive's provisions pertaining to those processes. In doing so, the Secretary of the Army should consider providing guidance as to how departmental officials may leverage already existing information regarding private companies. (Recommendation 2)

    Agency Affected: Department of Defense: Department of the Army

  3. Status: Open

    Comments: DOD partially concurred with this recommendation. In its response, the department noted that the Department of the Navy had suggested that the recommendation be restated to recommend that the Department of the Navy ensure that its guidance and procedures are updated to align with DOD's directive on climate adaptation upon issuance of an updated directive. However, DOD has not identified any plans to update its directive on climate change adaptation. Thus, we continue to believe that the Department of the Navy should update its guidance related to acquisition and supply to incorporate the current guidance in DOD's climate adaptation directive, which it has not yet done. We will continue to monitor the status of this recommendation.

    Recommendation: The Secretary of the Navy should implement DOD Directive 4715.21 on climate change adaptation and resilience by updating, as appropriate, relevant Department of the Navy guidance related to acquisition and supply processes to incorporate the directive's provisions pertaining to those processes. In doing so, the Secretary of the Navy should consider providing guidance as to how departmental officials may leverage already existing information regarding private companies. (Recommendation 3)

    Agency Affected: Department of Defense: Department of the Navy

  4. Status: Open

    Comments: DOD concurred with this recommendation. In its response, the department noted that the Air Force will work with the Office of the Under Secretary of Defense for Acquisition and Sustainment and the other military services to develop specific policies that address climate-related risks to DOD contractors. We will continue to monitor the status of this recommendation.

    Recommendation: The Secretary of the Air Force should implement DOD Directive 4715.21 on climate change adaptation and resilience by updating, as appropriate, relevant Department of the Air Force guidance related to acquisition and supply processes to incorporate the directive's provisions pertaining to those processes. In doing so, the Secretary of the Air Force should consider providing guidance as to how departmental officials may leverage already existing information regarding private companies. (Recommendation 4)

    Agency Affected: Department of Defense: Department of the Air Force

  5. Status: Open

    Comments: DOD concurred with this recommendation. In its response, the department noted that formal mission assurance assessments are limited in scope in order to provide additional rigor to protect DOD's most critical capabilities. However, the department stated that the Office of the Under Secretary of Defense for Policy would work with the Office of the Under Secretary of Defense for Acquisition and Sustainment's Defense Contract Management Agency to better understand DOD's commercial dependencies. We will continue to monitor the status of this recommendation.

    Recommendation: The Secretary of Defense should ensure that the Under Secretary of Defense for Policy, in coordination with the Under Secretary of Defense for Acquisition and Sustainment, the Secretaries of the military departments, and any other governmental and private-sector partners, as appropriate, determine what approaches may be feasible in conducting mission assurance related assessments of commercially owned facilities. (Recommendation 5)

    Agency Affected: Department of Defense

  6. Status: Open

    Comments: DOD partially concurred with this recommendation. In its response, the department noted that it concurs with the need to clarify steps that officials may take to apply the mission assurance framework to defense critical infrastructure and critical defense industrial base commercially owned facilities, to include consideration of risks related to climate change and extreme weather. However, the department further noted that it does not concur with doing this for all commercial facilities because conducting such assessments for all commercially owned facilities falls outside the capacity and authority of DOD to conduct mission assurance assessments. However, we had not recommended they conduct such assessments for all commercial facilities. We will continue to monitor the status of this recommendation.

    Recommendation: The Secretary of Defense should ensure that the Under Secretary of Defense for Policy, in coordination with the Under Secretary of Defense for Acquisition and Sustainment, the Secretaries of the military departments, and any other governmental and private-sector partners, as appropriate, issue new or update existing guidance, based upon the determination of what approaches may be feasible, to clarify the steps that DOD officials involved in the mission assurance process may take to apply the mission assurance framework to commercially owned facilities, as appropriate, to include consideration of risks related to climate change and extreme weather. (Recommendation 6)

    Agency Affected: Department of Defense

 

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