Harnessing climate scenario analysis for resilient and sustainable strategies
In today's world, the urgent call to address climate change is clear, with businesses and organizations at the forefront of adopting innovative strategies to mitigate risks and leverage new opportunities. Climate scenario analysis emerges as a pivotal approach, enabling forward-thinking leaders to explore various futures under different climate conditions and policy landscapes.
Representative concentration pathways (RCPs) and shared socioeconomic pathways offer a framework to explore various climate futures. These scenarios enable businesses to assess the spectrum of climate change impacts from the physical repercussions, like extreme weather events, to the transitional challenges arising from shifting global climate policies. Acknowledgment of both physical and transition risks marks the initial step towards resilience. Yet, the real advancement lies in accurately quantifying these risks and seamlessly integrating them into a holistic strategic plan. Achieving this integration requires a dedication to transparency and a strategic approach to analytics and disclosures, ensuring that businesses are not only prepared but also proactively positioned for the future.
KPMG possesses extensive experience in climate risk analysis. We offer support in evaluating climate risk scenarios, navigating changing regulations, transforming climate challenges into advantages, and creating customized solutions for specific organizational needs.
Explore our insights to better understand how climate scenario analysis, alongside a deep dive into both transition and physical risks, forms the basis of a robust and resilient business strategy.
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