As the impacts of climate change hit harder, a new realism is dawning about our changed circumstances. Increasingly, we are recognising that climate change isn’t just a future problem from which we must protect our children. It is a problem from which we must protect ourselves today.

We need to fight climate change with both sword (cutting our emissions to fight further increases in warming) and shield (protecting ourselves from climate change’s increasing effects). Adaptation and mitigation should be pursued, as UN Secretary General António Guterres said, “with equal force and urgency.” Over 1C of warming has already happened, and warming over 1.5C is very likely. We are nowhere near ready for the impacts this will bring.

Climate adaptation action plan

On 8 November 2022, the COP27 Presidency launched the Sharm-El-Sheikh Adaptation Agenda – the first ever comprehensive global action plan rallying governments and non-state actors behind 30 adaptation goals for a resilient world by 2030. This framework signals a growing expectation that business, alongside other actors (countries, cities, investors, civil society), take action to adapt to the acute hazards now facing us.

Adaptation is a crucial part of the fight against climate change. It is necessary to protect people around the world from the climate change that’s already in process, and it also brings huge opportunities to help 7.8 billion people transition to a more sustainable and secure way of life.

For example, transitioning to climate-resilient farming practices could increase yields by 17% without increasing land use. Adaptation will spur the expansion of industries, such as water conservation, heat-resistant infrastructure, and drought-resistant agricultures, supporting prosperity and security for billions of people as we build a climate-resilient world.

Adaptation is good for business. It can help companies expand their business footprint, achieve efficiency gains, innovate for the future, and enhance long-term sustainability. In addition, business adaptation is good for the society of which business is an inseparable part. Business thrives when society thrives.

Retooling society to cope with a warming climate is a huge task. Business, with its dynamic capacity to power innovation and change, has a critical role to play. That’s why PwC and the World Economic Forum are collaborating to help drive adaptation to climate change. We’ve united a global community from the private and public sectors to define three areas in which business can take action:

1. Enhance resilience

Companies should assess their climate risks and build sufficient resilience. Companies should study the risks in their supply chains, identifying risk hotspots, prioritising areas for adaptation, and supporting stakeholders in their supply chains with the technical skills and financial support they need to adapt. For example, a large retailer identified dozens of its facilities at risk of extreme weather, while a major conglomerate identified hundreds of millions of dollars of potential climate-related risks in its supply chain – enabling both companies to take action to build resilience. Other firms are striving to build resilience through developing or using, for example, weather data and early warning systems, drought resistant crops, flood defences, waste water collection and re-use, cooling systems, heat resistant infrastructure, and more.

2. Capitalise on opportunities

Businesses can flex their skills in investment and innovation to develop and scale products and services that enable society to live sustainably in the new climate reality. This includes, for example, investing in R&D and building ecosystems to foster innovation and scale new adaptation solutions.

3. Shape collaborative outcomes

Successful adaptation requires cross-society collaboration. Managing climate change requires partnership between all parts of society. Businesses can participate in multi-stakeholder efforts that promote action on climate change adaptation, from engaging with governments on policy-making to collaborating with industry players, community leaders, academia, development agencies and others to promote action. Partnering with local communities is particularly valuable because climate change has different impacts in different locales, meaning adaptation solutions need to be hyper-local. In addition, companies can join adaptation initiatives like Race to Resilience, co-invest in adaptation projects, and provide technical support to adaptation efforts.

Investing in climate adaptation

In short, smart companies are acting now to adapt to a climate that is changing before our eyes. The more energetically business dedicates itself to adaptation, the more society as a whole is helped to adapt and benefit.

Some business leaders view adaptation as a corporate social responsibility initiative rather than a business imperative as part of the overall execution strategy and risk management. We encourage these executives to recognise that all companies can be affected by climate change. Even business leaders who may believe their companies have little exposure to climate change have no reason for complacency.

The effort of adaptation is worth it. Globally, $1.8 trillion of investment into adaptation efforts could generate $7.1 trillion in total net benefits by 2030. Insurers reckon that a dollar spent on adaptation – strengthening flood and wind defences, for example – saves five in reconstruction. Best of all, of course, proactive adaptation opens up opportunities to build a more sustainable world.

We encourage all companies to take action in these three areas to help fight climate change with both sword and shield.