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SUSTAINABILITY-BASICS5 MIN READ

Sort: Physical Risk, Transition Risk, or Opportunity?

Differentiate climate-related physical risks, transition risks, and climate-related opportunities.

Sort each scenario into the climate category that fits best. Physical Risk Transition Risk Opportunity Rising summer heat increases cooling loads and raises the failure rate of on-site equipment. A major customer starts requiring product-level emissions data as a condition of contract renewal. An efficiency retrofit could lower energy use and improve operating margins at the same time. Flood-prone transport routes create a growing risk of shipment delays and inventory disruption. A future carbon price would make current fuel-intensive processes more expensive relative to alternatives. A lower-emissions product design could unlock new demand from procurement teams with sustainability criteria. Extended…

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