Climateadaptation:

Harnessingtech-drivenresiliencetocreatesustainablevalue

ListofAbbreviations

ADHDAttentionDeficitHyperactivityDisorder

AIArtificialIntelligence

AR66thAssessmentReport

BAUBusinessAsUsual

CAGRCompoundAnnualGrowthRate

CapExCapitalExpenditure

CPRConsumerProductsandRetail

CSRCorporateSocialResponsibility

CSRDCorporateSustainabilityReportingDirective

DLMDynamicLoadManagement

EBITDAEarningsBeforeInterest,Taxes,Depreciation,andAmortization

EngBioEngineeringBiology

EM-DATEmergencyEventsDatabase

EOEarthObservation

EoLEndofLife

EUEuropeanUnion

GDPGrossDomesticProduct

GEGeneralElectric

GHGGreenhouseGas

IFRSInternationalFinancialReportingStandards

IOTInternetofThings

IPCCIntergovernmentalPanelonClimateChange

ISSBInternationalSustainabilityStandardsBoard

KPIKeyPerformanceIndicator

MLMachineLearning

NGONon-governmentalOrganisation

NXPNXPSemiconductorsN.V.

OECDOrganizationforEconomicCo-operationandDevelopment

R&DResearchandDevelopment

R&IResearchandInnovation

ROIReturnonInvestment

SSPSharedSocioeconomicPathway

TAMTotalAddressableMarket

TCFDTaskforceonClimate-relatedFinancialDisclosures

TNFDTaskforceonNature-relatedFinancialDisclosures

UNECEUnitedNationsEconomicCommissionforEurope

UNFCCCUnitedNationsFrameworkConventiononClimateChange

UPSUnitedParcelService

USDUnitedStatedDollar

WRIWorldResourcesInstitute

WUEWaterUseEfficacy

2Climateadaptation

3Climateadaptation

Background

Theclimatecrisisisnotafutureconcern–it’san

ongoingrealitydisruptingbusinessvaluechainsacrosstheglobe.From2000to2024,climate-linkeddisastershavecausedover$3.6trillionineconomicdamage,withstormsaccountingfor60%,floodsat27%,and

droughtsat7%.

1

746

664

317

343

66

1010

115

482

122035

458

150

244

261523

5

2000-20042005-20092010-20142015-20192020-2024

Economiccostofclimate-relateddisasters($billion)five-yearsumofreportedcostofdisastersfrom2000-2024

By2050,climatechangewillcausedamagesin

agriculture,infrastructure,productivity,andhealth

amountingtoanestimated$38trillionperyear.

2

Evenwithimmediatedecarbonizationefforts,theglobal

economywillundergoa19%incomereductionby2050duetoclimatechange.

3

914

192

599

52

66

1,023

247

621

52

39

9

OvertwodecadesFloods1.7xStorms2.6xDroughts4.1xWildfires2.6xOthers30.4x

Figure1:Increaseinnumberofextremeweathereventsandtheeconomiclossesfromthem.Source:EM-DATdatabaseofInternationalDisasters.

Companieswillbearthebruntofthese

physicalclimaterisks.Thisisalready

happeningintheformofdisruptionandlosstotheirassetsandproductivity,particularlyfromextremeweathereventsandchronic,long-termclimatepatternchanges.

Additionally,transitionalclimateriskswillariseas

businesseswillneedtoaligntoaclimateresilient

economy,requiringadjustmentstonewpolicies,

technologies,andmarketdynamics.Failuretonavigatetheseriskscouldresultinreducedshareholdervalue,strandedassets,andincreasedlegalliabilities.

4Climateadaptation

Astheworldadjuststothis“newnormal”,climate

adaptationwillbecomeastrategicimperativefor

organizationstoensuretheirlong-termresilience

througheffectiveriskmanagementstrategies.Simply

put,climateadaptationisthesetofproactivemeasuresbusinessestaketoprepareforandadjusttothecurrentandfutureimpactofclimatechangeacrossitsvalue

chain.Forbusinesses,long-termsustainabilityand

profitabilitywilldependnotonlyondecarbonizationbutalsoonembeddingadaptationacrossvaluechains.

ForS&PGlobal1200companies,neglecting

climateadaptationcouldresultinstaggering

lossesof$1.2trillionannuallyby2050,even

underoptimisticgreenhousegasemissionreductionscenarios(SSP2-4.5).

4

Thus,embracingclimate

adaptationgoesbeyondcorporatesustainabilityrequirements–italsorepresentsapressing

financialimperative.

Annualfinancialimpact($billion)

1800

1600

1400

1200

1000

800

600

400

200

884

2030s

1206

2050s

1641

2090s

ExtremeheatWaterscarcityDrought

WildfireFluvialfloodTropicalcyclone

PluvialfloodCoastalflood

Landslide

Figure2:Annualfinancialimpact(in$billion)ofphysicalclimaterisksontheS&PGlobal1200companies.Source:S&PGlobal(2025).Fortheworld’slargestcompanies,climatephysicalriskshavea$1.2trillionannualpricetagbythe2050s.

Therewon’tbeanexception.Acrossindustries,

companieswillfacevaryingdegreesofvulnerabilitytoclimatechange,withnature-dependentand

infrastructure-heavysectorslikelyexperiencingthemostsevereconsequences.

Forexample,utilitiesareatriskastheyareprojectedtoexperiencethelargestimpactfromclimatechangeacrosssectors.Withoutaction,themedianelectric

utilityintheS&PGlobal1200isprojectedtoloseupto$4.6billionannuallyinthe2050s.

5

Additionally,risksandcostsinoneindustrywillhavearippleeffectacrossbusinessecosystems,cascading

intoothersectorsascompaniesseektopasshighercostsassociatedwithclimatedisasters.Forexample,energycompanies’difficultyinsecuringsupplywillresultinhighercostsforenergy-intensiveindustrieslikechemicals,ironandsteel,cement,andfoodandbeverageprocessing.

Buildingbusinessresiliencethroughclimate

adaptationisfinanciallyconsistent,asproactive

investmentsarelesscostlythanretroactive

rebuilding.Forexample,asindicatedinFigure3,a

benefit-costanalysisofvariousclimateadaptation

measuresestimates$2to$10neteconomicbenefitsforeverydollarinvested.

6

Benefit-CostRatio

1:15:110:1

NetBenefits

Strengtheningearlywarningsystems

Makingnewinfrastructureresilient

Improvingdrylandagriculturecropproduction

Protectingmangroves

Makingwaterresourcesmanagementmoreresilient

$0.1T

$4.0T

$0.7T

$1.0T

$1.4T

TotalNetBenefits$7.1T

Figure3:Costbenefitratioofinvestmentsinvariousclimateadaptationsystems.Source:GlobalCommissiononAdaptation(2019),

AdaptNow:AGlobalCallforLeadershiponClimateResilience

Ignoringordelayingadaptationcanleadtotaxing

socio-economicandfinancialconsequences.

Unpreparedcompaniesrisklosinganaverageof

14%oftheirEBITDAoverthenext20yearsduetothephysicalimpactofclimatechange,particularlyin

infrastructure-dependentsectorssuchasutilities.

7

Implementingclimateadaptationplansiscrucialfor

businessestoproactivelyaddresstheclimateriskon

theiroperationsandsupplychains.Byintegratingthesemeasures,businessesensurecontinuityandresilience.

5Climateadaptation

6Climateadaptation

BusinessValueChainsFace

Investors

IncreaseddemandforclimateandESGriskmanagement

Businessvalue

SourcingManufacturingTransportation

and

distribution

Productuse

andendof

life

ProductsandservicesR&D

Consumers

Stringentsustainability

standardsfor

businesslicensing

Increasedmandateson

corporateclimateand

sustainabilitydisclosures

Policy

5CriticalClimateRisks

RisingpreferencetowardsclimateandESGfinancing

environment

Keyvaluechainrisks:

Naturalraw

materialsscarcity

Humanproductivity

andwell-beingimpacts

Waterandenergyinsecurity

Infrastructure

damageandloss

Marketchangestowardsclimatefriendlyproductdemands

Abusinessvaluechainspansaproductorservice’s

conception,delivery,andend-of-lifecycle.Itincludes

criticalsegmentslikeR&D,sourcing,manufacturing,

transportationanddistribution,andconsumeruse.Thisisfurtherimpactedbytheprevailingpolicyenvironment,aswellasinvestorandstakeholderinterests.

Businessesfacefivecriticalclimaterisksacrosstheirvaluechains.Theseare:

1.Scarcity:Climatechangeisescalatingthescarcity

ofnaturalrawmaterials,deterioratingbothyieldand

quality.Thisalsoaffectssourcingandhindersproduct

researchanddevelopmentacrossseveralsectors,

includingpharmaceuticalsandconsumerproducts.

Withglobalnaturalresourceconsumptionexpectedtosoarby60%by2060from2020,businesseswillstruggletosecurecriticalnaturalrawmaterials.

8

Climate-relateddisastersandchangingweatherpatternswillreduce

cropyields,livestockproductivity,andecosystemhealth.Thisunsustainabledemand,coupledwithdeclining

qualityinagricultureandforestryproducts,threatensto

disruptproduction,strainsupplychains,inflateprices,andreduceprofitmargins.

9

Companiesmustalter

theirbusinessmodelstomeetnewresourcerealities.

2.Insecurity:Climatechangewillincreasewaterandenergyinsecurities,reducingwateravailabilityand

quality,whilecausingasurgeinenergydemand.

Overconsumptionandclimatechangearejeopardizingglobalenergyandwatersecuritybyimpeding

productionanddrainingsupply.

10

Manufacturing

accountsfor20%offreshwaterwithdrawalsandallindustrialsectorswillfacevaryinglevelsofimpactfromrisingwaterstress.

With87%ofglobalelectricityderivedfromthermal,nuclear,andhydroelectric,systemsaredirectly

reliantonwateravailability,andscarcitywilldirectlyresultindwindledenergyproductionandsupply.

11

Further,risingtemperaturesarealteringenergy

demand.In2024,recordelevatedtemperaturescausedglobalelectricityconsumptiontonearlydoubletheannualaverageinthepastdecade.

12

7Climateadaptation

3.Vulnerability:ClimatechangeisincreasinginfΓastΓuctuΓedamageandlossacΓossthe

valuechain.lmpendingclimatedisasteΓsthΓeaten

valuableassets,includingpΓopeΓty,manufactuΓingplants,andcΓiticalpublicinfΓastΓuctuΓelikeΓailsandΓoads.CuΓΓentdisasteΓsalΓeadyΓesultinaveΓage

annuallossesof$845billiontoinfΓastΓuctuΓeandbuildings-appΓoximately14%ofglobalGDP.

13

CompaniesmustanticipatedestabilizinglossesanddamagestoinfΓastΓuctuΓe,whilebolsteΓingtheΓesilienceofnext-geneΓationconstΓuctionstowithstandclimatechangeeffects.

4.Disruption:ClimatechangewilladveΓselyaffecthumanwell-beingandpΓoductivitythΓoughextΓemeweatheΓevents,infectiousdiseases,anddisΓuptionsinfoodandwateΓsupplies.FoΓbusinesses,this

impliesΓeducedwoΓkfoΓcepΓoductivity,both

inteΓnallyandacΓossitssupplychains,alongwithanegativeimpactonconsumeΓs’healthandwell-being.ThelnteΓgoveΓnmentalPanelonClimateChange(lPCC)6thAssessmentRepoΓt(AR6)

highlightsthat3.6billionpeopleaΓehighly

vulneΓabletoclimatechange,

14

with2.4billion

woΓkeΓs-70%oftheglobalwoΓkfoΓce-

annuallyexposedtohealthhazaΓdslikeheat

stΓoke,malnutΓition,skincanceΓ,ΓespiΓatoΓy,

caΓdiovasculaΓdiseasesandphysicalinjuΓy.

15

TheclimatecΓisiswillcostglobalhealthcaΓe

systemsatleast$2.1tΓillionby2030,incΓeasingtoastaggeΓing$12.5tΓillionby2050.

16

5.Liability:ClimatechangeispΓecipitatingmaΓketshiftsinpolicy,technologies,and

consumerdemandthatgiveriseto

climate-fΓiendlyalteΓnatives.Non-compliancewithemeΓgingclimateΓiskandadaptationdisclosuΓesandΓegulationscanΓesultinsignificantlegal

andfinancialpenalties.Thesecouldincludefinesandsanctions,damagingmaΓketpositionand

investoΓΓelations.ConsumeΓpΓefeΓencesaΓealsoevolving,assuΓveysshowthat62%ofconsumeΓsnowexpectindustΓiestoactivelyaddΓessclimatechangebycuttingemissions.

17

Businesses

mustΓecognizethisshiftinmaΓketattitudesthatdemandbothsustainablealternativesandpΓoactiveclimatecoΓpoΓateaction.

8Climateadaptation

UnlockingBusinessValuethroughTech-DrivenClimateAdaptation

Thefivevaluechainriskscanthreatenabusiness’

abilitytoprotectandcreatevalue.However,

companiesthatleveragetech-drivenclimate

adaptationarealreadyunlockingbenefits.Five

promisingtechnologies-artificialintelligence(AI),

drones,earthobservation(EO)technologies,InternetofThings(IoT),andengineeringbiology(EngBio)-

havedemonstratedtheirabilitytooperationalizebusinessesadoptingmoreresilientpractices.

Inthefollowinganalysis,wefirstexplorethe

financialadvantagesofclimateadaptation,thendelveintohowthesefivetechnologiescanhelpbusinessestacklethepainpointsthatcanarise.

Protectingvaluethroughtech-enabledclimateadaptation

Acrossindustries,companiesshouldfocuson

protectingvaluebyembeddingclimateadaptationintotheirexistingbusinessstrategy,operatingmodels,andassets.Thisbuildsresilienceacrosstheirentirebusinessline.Infact,investinginadaptation,decarbonization,

andresiliencycansavecompanies$19inavoided

lossesfromclimateimpactsforeverydollarspent.

18

Companiesgenerallyfacethreemajorpaintpointsinprotectingthevalueoftheirexistingbusinessvaluechain:

1.Understandingclimatechangerisksandtheirimpactonbusinessmodels

Companiesoftenstruggleinarrivingatanuanced

understandingofthelikelihoodandimpactofclimaterisksontheirvaluechain.Amixtureofglobaland

regionaldynamics,aswellasdatagapscanmake

predictiveanalysisdifficult.Throwinthecomplexityofglobalizedsupplychainsandthiscanbecome

aseriousproblem.

However,AIandEOtechnologiescangivecompaniestherighttoolsforcomplexyetstreamlineddata

analytics.Forexample,inagriculture,predictivemodelsusingthesetoolscanconductpossiblescenarios

andimageanalysisonlargedatasetstobetter

forecastdroughtandfloodriskbeforetheyoccur.

Additionally,thesetechnologiesalsoallowbusinesses

tomonitortherisksandimpactofclimatechange

overlargertimelinesandland-usescales.Thisallows

forelevatedresourceplanning,suchasconsidering

energyandwaterrequirementsforproduction,aswellassupplychainoptimization.Toillustrate,agricultural

businessescanleveragethesetoolstoforecast

temperatureandprecipitationchangestooptimizecropplantingschedules,avoidingpotentialyieldlosses.

2.Enhancingtheadaptivecapacityandresilienceofbusinessesexistingoperationsandsupplychainstopre-emptfuturechallenges

Havingestablishedanunderstandingoftheirkeyclimaterisks,businessesmustfocusonadaptingtheirassets

andsupplychainstowithstandtheirfutureimpact.Thisismadedifficultwhenrelyingonlegacytechnologies,particularlyonesthatareachallengetoretrogradeintoclimate-resilientapplications.

Forexample,risingwaterscarcitywillchallengetheabilityofconventionalirrigationtechnologiestoachievethe

desiredrawmaterialsproductivity.Hencethetransitiontosmartirrigationtechnologies,whichenableprecisionfarmingandwaterefficiency,willbecomeinevitable

undernewclimaticconditions.

Further,drone-ledprecisiontargetingandplantingis

helpingbusinessesgeneratevaluethroughconsiderablereductionsinwasteandcosts.IoTtechnologiescanbe

leveragedalongsidedrones.Precisionfarmingtechniquesutilizeadvancedtechnologiestoreduceresourceuseandoptimizeproductivity.AgriculturalbusinessescandeployIoTsensorstocollectdataonsoilmoisturecontent,

temperature,andcrophealth.Thisleadstomoreefficientuseoffertilizers,pesticides,andoverallenergyand

wateruse–resultinginlesswasteandimprovedyields.

3.Respondingdynamicallytoimpactsastheyoccur

Real-timemonitoringsystemswillempower

organizationstomakedecisiveactioninthefaceof

variousclimatedisastersastheyoccur.Itprovidestimely,accuratedatathatgivescompaniescompletevisionoverthelikelihoodandscaleofimpactstheycouldbefacing

duringadisasterevent.Italsoimprovesdisaster-response

9Climateadaptation

time,andcompaniesneedtodeployclearcommunicationchannelstoallowtheflowofthisdatatobeshared

rapidly.Thisproactiveuseofdataalsoallowscompaniestomaintainahighlevelofflexibilityintheircrisis

managementstrategies.

AI-augmenteddronesareapowerfultoolthatcanbe

usedtorespondtoclimatedisasters.Dronesurveillancecanproactivelyidentifydisruptionsandhastenresponses.Forexample,in2019,UPScompleteditsfirstdrone-baseddeliveryofprescriptionmedicationsfromapharmacytocustomers’homes.

19

Duringanaturaldisaster,thiscan

beusedtosafelyprovidevitalmedicalsuppliestofirstrespondersorvictims.

IoTcanalsohelpstreamlinecommunicationanddata-sharing.BusinessescanembedIoTacrosssupplychainstotracklogisticsandclimatedisasterdisruptions,

monitoringproductionlevelsasafunctionofreal-timeenvironmentalchanges.Organizationscanmaintain

astableoutputandprotectexistingvalue.

CreatingValuethroughTech-EnabledClimateAdaptation

Climateadaptationalsoopensupawealthofnew

marketopportunities.Thepotentialisconsiderable,

asgreenmarketsacrosssectorsareexpectedto

growto$14trillionin2030,comparedto$5trillion

in2024.Earlyadoptersofalternativeenergysources(49%ofmarketshare),sustainabletransport(16%

ofmarketshare),andconsumerproducts(13%of

marketshare)arewellpositionedtosecurethese

opportunitiesandcapturevaluebeforecompetitors.

20

However,therearethreecentralchallengesthatarisewhenlookingtotapintocreatingthisnewvalue:

1.Understandingnewopportunitiesforresilientalternativesandbusinessmodels

Businessesmaylacktheforesighttoanalyzetheindirecteffectsofclimatechangetospotemergingmarket

opportunities.Thiscanbeachallenge,ascreatingvalueoftenrequireslong-terminvestmentsinto

technologicalcapabilities,whichmayhavegradualreturns.Companiesmayalsostruggletoforecastevolvingconsumerpreferences,leadingto

apotentialdisconnectwiththemarket.

Here,AI-drivendataanalyticscanhelpbusinessesdevelopproductsandservicesthatalignwith

shiftsinconsumerdemandbypredictingconsumerbehavior,preferences,andenvironmentalconcerns.Thiscanhelpequipbusinessestodeveloptailoredmarketstrategieswhileadoptingclimate-friendlyproductsandservices.Inaddition,dronescanhelpgeneratevaluethroughland-usepatterndetectionthatcanprovidepredictionsofmarketdynamics.

2.Movingtomoreresilientalternatives

Inthemidtolongterm,businessesmayneedtoshifttonewsourcesofwater,energy,andrawmaterialsasexistingonesbecomenon-viableforoperations.Inadditiontothis,companiesmustalsoconsider

transitioningtowardmoreproductiveandhigher-yieldingsourcesandvarietieswithlowerresourcerequirements.However,achievingthisrequires

extensiveamountsofR&Dtestingandinvestmenttoachieveeconomiesofscale.

Tosimplifythetaskofbuildingresource

efficiency,companiesaretappingintoatandem

oftechnologies.Dronesprovideaclearalternativetoalleviateenergyconsumptionintransportandlogistics.Forexample,freighttransportalone

generatesaround40%ofalltransport-relatedemissions,

21

whereasdronescanreduceenergyusebyupto80%.

22

Engineeringbiologyhastremendouspotentialin

providing

resilientalternatives.

Inagriculture,it

canhelpdevelopclimate-resilientcropvarieties,

ensuringconsistentproductionevenundermore

extremeclimaticconditions.Forinfrastructure,itcantaketheformofbio-basedbuildingmaterialsand

bio-inspiredstructurestomitigateGHGemissions,whilestrengtheningassetsagainstpotential

climatedisasters.

10Climateadaptation

ValuechainrisksBusinessesmustbuildUnlockingvaluethroughtechnology

resiliencethrough:

Understandimpactof

climaterisksonbusinessmodels

Enhanceadaptivecapacityandresilienceofexistingoperationsandsupplychains

Responddynamicallytoimpactsastheyoccur

Understandnewopportunitiesforresilientalternativesand

businessmodels

Shifttoclimateresilientalternatives

Transitiontonewmodelsandsystemswhicheliminateordrasticallyreduceunsustainabledependencies

ProtectingValue:

Safeguarding

existingsystems

byimprovingtheir

adaptivecapacity

toclimaterisks

Waterandenergyinsecurity

CreatingValue:

Transitioning

tonewclimate

resilientsystems

andcapturing

opportunitiesarising

fromclimatechange

Humanproductivity

andwell-beingimpacts

Marketchangestowardsclimatefriendlyproductsdemands

Naturalraw

materialsscarcity

Infrastructure

damageandloss

Artificial

intelligence

Earth

observation

Engineeringbiology

Drones

IoT

Figure4:Businesseswillberequiredtoadapttofivekeyvaluechainrisksby“protectingvalue”and“creatingvalue”

3.Transitioningtonewmodelsandsystemswhicheliminateordrasticallyreduceunsustainable

dependencies

Adrasticreductionintheneedfornewresources

requiresashiftbothinbusinessmodelsandin

technologies.Forexample,asignificantdeclinein

freshwaterdemandcouldbeachievedthroughadoptingdesalinationtechnologyandclosed-loopwatersystems.

Thedisciplineofengineeringbiology(EngBio)isacriticalcomponenttoachievingthis.

Thesetechnologiescanenhanceenergysecuritybyfurtheringsustainablebiofuelsforcommercialuse.

Similarly,EngBioallowscompaniestoreassesstheir

needforlarge,purifiedwatersources.Engineered

microorganismscanbeusedforwatertreatment,

reducingcontaminantsbyupto90%.Thisenhances

watersecurity,whilereducingdependence.Allofthesenewsourcesprovideacost-effectivealternativeinthefaceofdwindlingresources.

11Climateadaptation

Promising

technologyusecasesforclimateadaptation

Thisanalysisdeep-divesintostrategiestoaddressthreecriticalvaluechainrisks:naturalrawmaterialsscarcity,waterandenergyinsecurity,andinfrastructuredamageandloss.Weoutlinehowbusinessescanleveragetech-enabledinitiativestoprotectandcreatevalueagainsttheserisks.

Webeginbyexaminingthesubstantialvaluelosses

fororganizationsthathaveinadequatelyadaptedto

climatechange.ThroughcasestudiesfromCambridgeConsultantsandCapgeminiInvent,wedemonstrate

howAI,drones,EO,IoT,andEngBiotechnologiescanhelptoavoidlossesanddrivecompetitiveadvantage.Thisreportshowcaseshowthesetechnologiesare

pavingthewayforamoreclimate-adaptivefuture.

Deep-Dive1:Securing

sustainablesupplychainsfornaturalrawmaterials

Inactionbyagribusinessesinadaptingnew

croppingsystemstomitigatenaturalrawmaterialconstraintswillhaveacascadingeffectonotherindustriesdownstream.Forexample,failure

toadapttoclimateconditionssuchasdroughtcoulddecimatecropsthatarerequiredbytheenergyindustryforbiofuelproduction.

Thiswasmadeclearin2021-2022,whenBrazilian

sugarcaneharvestswerehitbythelongestdroughtinacentury,andwerefurtherimpactedbythree

wavesoffrost.

27

Unpreparednessforthisdisasterresultedina7%reductioninthesugarcanesupply,whichresultedinethanol–akeyinputforbiofuel

–hittinganall-timehighpricealongsidea6.1%

fallinproduction.

28

Thus,agribusinessesmust

protecttheircropandlivestockproductsnotonlyforthecontinuationoftheirownproduction,

butalsoforthatofdownstreamindustries.

It’simperativethatbusinessesacrossallsectors

closelyassessandadapttheiracquisitionofnaturalrawmaterialstostayaheadofclimaterisksand

ensuingscarcitychallenges.Thesenaturalraw

materialsaredefinedasplant-basedandanimal-derivedresourcesfromterrestrialandaquatic

ecosystems.Organizationscanstartbyanalyzingtheirbusinessdependenceonsuchnaturalrawmaterials,alongsidetheirabilitytodetermine

theclimatevulnerabilityoftheseresources.

Someindustriesaremorevulnerablethanothers.

Agribusiness,healthcare,andconsumerproductsandretailarehighlyexposedtoclimate-inducednaturalrawmaterialscarcity.Thismakesbuildingclimate

adaptivepracticesabusinessimperative,especiallyforthesesectors.So,whataretheseindustries

facingandhowcantheybuildclimateresiliency?

Climateadaptationisinstrumentalforagribusinessestostaveoffclimate-inducednaturalrawmaterial

scarcity,particularlyincropsandlivestockproducts.

Commercialagriculturehassuffered$15billioninlossesofmaize,wheat,barley,andotherstaple

cropsduetoheatwavesanddroughtsoverthe

last30years.

23

Thiswasparticularlyevidentincocoaproduction,whereindrierweatherresultedinpoorcocoaandsugarharvests;theresultwasadrasticreductioninavailabilityanda90%surgeinpricesin2024.

24

Futureprojectionsaresimilarlybleak,with

projectedagriculturaldamagefromheatwaves

aloneasapercentageofEUGDPexpected

togrowfivefoldby2060.

25

Thiscanleadto

compoundingchallenges,aslossesincritical

cropssuchascorn,soybeans,andgrainimplies

highercostsforanimalfeed,leadingtolower

livestockproductioninturn.

26

Whiletheserisks

areunlikelytoreverseEurope’spositionasa

topglobalagriculturalproducer,thefinancial

impactonagribusinessisareality.Proactivestepsmustbetakentobuildtech-enabledclimate

adaptationandprotectnaturalrawmaterials.

12Climateadaptation

TheConsumerProductsandRetailindustrywillalsofaceseveralnaturalrawmaterialshortages,affectingboththeindustry’sagri-andforest-basedproducts.Foodandbeveragecompanieswillfacechallenges

fromclimate-inducedcropandlivestockscarcity,

whichcouldfurtherimpactotherindustries,su