Conducting a sustainability risk assessment enables companies to identify and evaluate climate-related risks and opportunities (R&Os) that may affect their long-term performance. Overlooking these can lead to financial setbacks, operational delays, or damage to your reputation. On the other hand, having  a strong understanding of your climate-related R&Os, enables more informed decision-making, strengthens long-term resilience, and ensures your business is better prepared for the changes ahead.

A sustainability risk assessment systematically evaluates R&Os across a company’s supply chain, operations, business model, resource dependencies, and markets. These R&Os stem from:

• Climate-related changes: extreme weather events, shifting crop growing zones due to changing weather patterns, water scarcity, etc.
• Transition events: new regulations, evolving consumer expectations, and technological advancements that reshape industries.

By examining these areas, businesses can better understand their vulnerabilities and areas for potential innovation, allowing for effective risk management and making the most of opportunities.

1. Develop a complete list of R&Os

• Identify climate-related risks and opportunities relevant to your sector.
• Assess dependencies on climate-sensitive resources (e.g., agricultural supply chains, water usage).
• Consider industry-specific transition risks, such as carbon pricing, new efficiency standards, and consumer behaviour shifts.

2. Rank R&Os by relevancy

Assess occurrence and scale: Rank R&Os based on their likelihood of occurrence and potential business impact.

3. Brainstorm adaptive measures

Hold a structured session to define actionable measures that align with business goals and resource capacities.

4. Evaluate actionability

• Risks: Determine how feasible mitigation strategies are.
• Opportunities: Assess the company’s ability to capitalise on these opportunities.
• Prioritise the top 20 R&Os and plot their relevancy against actionability to know what to focus on.
• Make a high-level roadmap for implementation and assign responsibilities for follow-up.

Ecomatters has extensive experience supporting businesses across various sectors. We understand your company’s context  and we know the climate Risks & Opportunities impacting your sector. If you would like to discuss how we can assist your organisation in identifying and managing climate-related events, dependencies, and transition events. Please contact us or schedule a call with one of our experts.​

By partnering with Ecomatters, your business can proactively address sustainability challenges, ensuring long-term success and resilience in an ever-changing global landscape.

Would you like to discuss double materiality in more detail with one of our experts?