The term Loss and damage denotes impacts of climate-related stressors that occur despite efforts to reduce greenhouse gas emissions and adapt to climatic changes. Loss and damage can result from sudden-onset events (climate disasters, such as cyclones) as well as slow-onset processes (such as sea level rise). Loss and damage can occur in human systems (such as livelihoods) as well as natural systems (such as biodiversity), though the emphasis in research and policy is on human impacts. Within the realm of loss and damage to human systems, a distinction is made between economic losses and non-economic losses. The main difference between the two is that non-economic losses involve things that are not commonly traded in markets.
At the 18th Conference of the Parties meeting of the UNFCCC in 2012 in Doha, Qatar, it took 36 hours of negotiation between 195 nations to arrive at a plan to address loss and damage associated with adverse effects of climate change particularly in countries most vulnerable to climate change. A new website was launched at the conference by the Loss and Damage Vulnerable Countries Initiative. It described its aim as being "the first dedicated site for news, resources and opinion on the issue of loss and damage associated with the adverse impacts of climate change". Examples of types of loss and damage include farmers who can no longer grow crops to eat, or grass to feed cattle, because their soil has become too salty, and fishermen who have lost their livelihoods because rivers have dried up.
In popular press, and in statements by some parties in the climate negotiations, the terms loss and damage is often associated with liability and compensation. This explains why the topic raises heated debates, and tends to widen the divide between developed countries, which are historically responsible for most greenhouse gas emissions, and developing countries that are more vulnerable to impacts of climate change. For vulnerable countries, loss and damage is most of all about recognizing that past and current efforts to avoid dangerous climate change, and that there are limits and constraints to adaptation.
The United Nations Framework Convention on Climate Change has developed a work programme on loss and damage which aims to find ways to address the issue in developing countries that are particularly vulnerable to the adverse effects of climate change. On 12–14 September 2013, it held a meeting in Fiji to consider how best to address loss and damage from 'slow-onset events'. These are impacts of climate change that occur over time, such as sea-level rise, rather than in a single, destructive event. Bangladesh is already suffering from loss and damage resulting from sea-level rise, due to its flat terrain in the coastal region.
At the 19th Conference of the Parties meeting of the UNFCCC in 2013 in Warsaw, Poland, the Warsaw International Mechanism for Loss and Damage associated with Climate Change Impacts was established. At the 20th Conference of the Parties in Lima, Peru (2014), the work plan of the executive committee of the Warsaw International Mechanism was approved.
The 5th Assessment Report of the Intergovernmental Panel on Climate Change (IPCC), published in 2013-2014 had no separate chapter on loss and damage, but WG2 Chapter 16 about adaptation limits and constraints, is very relevant for people interested in loss and damage. A qualitative data analysis (QDA) of what the IPCC 5th Assessment Report has to say about loss and damage surprisingly showed that the term was used much more often in statements about Annex 1 countries (e.g. US, Australia or European countries) than in text about non-Annex 1 countries (most countries in Africa, Asia Latin America and the Pacific), which tend to be more vulnerable to impacts of climate change. Whether or not the IPCC 6th Assessment Report will have a chapter on loss and damage has not yet been decided.