How can climate change affect a business?

Climate change can indeed lead to increased costs for a business. This may occur due to a variety of factors, such as the need to invest in more sustainable and environmentally friendly practices, changes in regulatory compliance, or heightened resource costs due to scarcity or increased demand for water and energy. Additionally, businesses might face costs associated with adapting to climate-related risks, such as extreme weather events that can disrupt operations, supply chains, and logistics. For industries that rely heavily on natural resources, climate change can also directly impact availability and cost, increasing expenses for procurement.

While there may be potential opportunities for marketing or sales tied to climate change, these are often not guaranteed or may not outweigh the increased costs businesses face when adapting to changes in the environment and shifting market expectations. Similarly, relationships with suppliers can become complicated due to resource scarcity and disruptions, rather than inherently improving as a result of climate changes. Therefore, the impact of climate change on costs is a significant concern for businesses in the current economic landscape.