Businesses and other organisations are not prepared for weather-related disasters, with out-of-date business continuity plans failing to reflect the frequency of disruption of climate-related events, according to this research.
This report paints a concerning picture of organisational preparedness, with only 20% of businesses and other organisations surveyed identifying climate-related risks across their operations. Even more troubling is that a mere 17% regularly rehearse their response to major disruptions, while 25% have no mechanisms in place to build resilience at all.
Mechanisms implemented to manage the risk of climate related disasters:
- Business continuity: plans to address sudden disruption to the organisation (58%)
- Business resilience capabilities: measures to future-proof the organisation (36%)
- Horizon scanning: identifying potential climate-related risks across various locations (20%)
- Scenario testing: rehearsing responses to major disruptions (17%)
- No mechanisms currently in place/being used (25%).
The escalating environmental threats demand comprehensive preparation measures. Yet our survey reveals that climate adaptation planning is still not receiving the urgent attention it requires. It’s time for organisations to take decisive action to protect both their future and the communities they serve.
However, resilience is not a priority for organisations with two-thirds of respondents not investing adequately to address the physical risks posed by climate change, and only 37% planning to increase spending in this area.
Data for the report came from ACCA Global Economic Conditions Survey of over 600 finance professionals around the world and illustrates these concerns vividly. Power outages topped the list of climate-related disruptions in Africa (54% of respondents), while North America’s leading worries included supply chain breakdowns (41%) and employee health issues (39%).
Key drivers for undertaking business resilience planning
- Operational continuity – ensuring business as usual during disruptions (48%)
- Long-term survival of the organisation (33%)
- Regulatory and compliance requirements (33%)
- Leveraging new technologies for enhancing resilience (29%)
- Employee health and safety (29%)
- Being better prepared than competitors (22%)
- Reputation protection (20%)
- Cost saving – investing in solutions for future power outages (19%)
- Maintaining insurance cover (17%)
- Investor and customer expectations (16%).
CFOs and finance teams are essential to building climate resilience through risk-based planning and sustainable business strategies. By championing transparency in emissions targets and transition plans, finance professionals play a critical role in reducing carbon footprints and advancing net-zero goals, ultimately supporting a fair, inclusive, and climate-resilient future.
