Continuity in a climate crisis

The reality of climate change becomes more apparent each day. From flooding to uncontrollable wildfires, people all around the world are feeling the catastrophic effects on their communities. These events highlight the pressing importance of tackling climate risks and their impact on business continuity.

Climate risk and business continuity planning are integrally linked. Preparing for and responding to the operational challenges posed by climate change are closely aligned to the need to ensure that essential business functions remain operating during and after a disaster.

Extreme weather events can threaten the ability of businesses to operate normally. They can affect supply chains, the workforce, property, plant and equipment, access to IT systems, to finance and insurance, reputational damage and even the ability to remain operational at all.

The case is clear: by integrating climate risk management into business continuity planning, organisations can minimise downtime. By taking measures to avoid operational disruption, they can also unlock opportunities for innovation and growth. Adapting to changing climate conditions can spur the development of new products, services and business models that resonate with increasingly climate-conscious consumers and investors. Embracing sustainability can enhance brand reputation, attract investment and talent, and future-proof businesses in fast-moving markets.

Regional differences

Climate risks and disruption vary from region to region. According to ACCA’s most recent Global Economic Conditions Survey, the primary disruption in Africa is power-related outages (54% of respondents). In North America, 41% of respondents cited supply chain disruption as the main concern, followed closely by employee health issues and absenteeism (39%).

Low priority

These differing threats underscore the need for comprehensive preparedness measures as part of entities’ climate adaptation plans. But the survey reveals that climate adaptation planning is not currently treated as a priority.

Cost conundrum

Some see climate adaptation efforts as a cost (21%) while others (29%) view them as crucial for avoiding economic loss. A third of respondents look on climate adaptation planning as an organisational opportunity.

Little commitment

Two-thirds of respondents are not investing adequately to address the physical risks posed by climate change, with only 37% planning to increase spending in this area.

State action

The survey suggests an expectation for greater government intervention next year to help achieve the transition to a green economy.

Where some see threat, others see opportunity, but one thing is clear: without business continuity planning in the context of climate risk, changing environmental conditions could be a threat to business operations and even organisations’ survival.