Business Adaptation to Climate Change and Global Supply Chains

The document examines the material risks climate change poses to global supply chains and the current state of private sector adaptation. It argues that while companies recognize climate risks, they often misdiagnose them by focusing on exposure rather than underlying vulnerability. Using the cotton industry as a detailed example, the paper proposes a resilience framework based on six capital assets—natural, human, social, physical, financial, and political—and provides recommendations for companies to commit to science-based resilience strategies and gender-transformative empowerment of women workers.

• Private sector awareness of climate risk has not yet translated into sufficient action; a review of nearly 2,000 companies found that they often underestimate costs, misdiagnose risks, and apply resilience strategies inconsistently.
• Climate change is identified as the highest impact risk to business, with potential global costs reaching US$2–4 trillion by 2030 for environment, health, and food security, and potentially up to US$24.2 trillion in lost market value of global financial assets under worst-case scenarios.
• The cotton sector is highly vulnerable to climate change, with temperature increases of 2°C expected to reduce crop yields. Specifically, land productivity in sub-Saharan Africa is projected to drop by 14–27% and in Southeast Asia by 18–32% by 2080.
• Climate risk is disproportionately acute for women in the cotton supply chain due to social and cultural norms that restrict their access to land, education, healthcare, and decision-making power.
• Effective business resilience requires investing in six interdependent 'Capital Assets': natural, human, social, physical, financial, and political capital, which together address the root causes of vulnerability.
• Many companies fail to distinguish between climate hazard, exposure, and vulnerability, often ignoring the underlying systemic weaknesses (vulnerability) that exacerbate the risk of a physical hazard.
• Closing the gender gap in agriculture could increase yields on farms by 20–30%, potentially raising total agricultural output in developing countries by 2.5–4% and reducing the number of hungry people globally by 12–17%.
• The author recommends that companies move beyond mitigation-focused pledges to formal 'resilience commitments' that include science-based risk assessments and strategies based on the six capital assets.

APA

Cameron, E. (2019). Business Adaptation to Climate Change and Global Supply Chains. World Resources Institute. https://files.wri.org/s3fs-public/uploads/Adaptation_and_Supply_Chains_Paper_-_Global_Commission_on_Adaptation.pdf

Chicago

Cameron, Edward. Business Adaptation to Climate Change and Global Supply Chains. World Resources Institute, 2019. https://files.wri.org/s3fs-public/uploads/Adaptation_and_Supply_Chains_Paper_-_Global_Commission_on_Adaptation.pdf.

Wikipedia

{{cite report |last1=Cameron |first1=Edward |title=Business Adaptation to Climate Change and Global Supply Chains |publisher=World Resources Institute |date=2 July 2019 |url=https://files.wri.org/s3fs-public/uploads/Adaptation_and_Supply_Chains_Paper_-_Global_Commission_on_Adaptation.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{cameron2019business, author = {Cameron, Edward}, title = {{Business Adaptation to Climate Change and Global Supply Chains}}, institution = {World Resources Institute}, year = {2019}, month = jul, url = {https://files.wri.org/s3fs-public/uploads/Adaptation_and_Supply_Chains_Paper_-_Global_Commission_on_Adaptation.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }