Climate Adaptation in Industry: Pathways to Resilience and Financing the Transition

By Paula Meireles and Luciana Lanna, founding members of IBRAAC – Brazilian Institute for Climate Adaptation.

1. The new paradigm of business adaptation

The intensification of extreme weather events, such as floods, droughts, and heat waves, already represents a concrete challenge for the industrial sector. [1] In Brazil, between 2013 and 2023, natural disasters caused economic losses exceeding R$ 732 billion in the country's cities. [2] This scenario highlights that adaptation is not just an environmental issue, but a matter of strategic management and operational continuity.

The industry, heavily dependent on physical infrastructure and complex production chains, needs to incorporate the climate variable into its business models. The private sector has a central role in mobilizing resources, innovating technologically, and implementing solutions that strengthen the resilience of its operations and the territories where it operates.

2. Frameworks and guidelines for corporate adaptation

The consolidation of international standards and frameworks has contributed to guiding and standardizing the reporting and implementation of corporate adaptation strategies. Key instruments include:

• IFRS S2 (Sustainability Disclosure Standards) – establishes parameters for disclosing climate-related risks and opportunities, including corporate adaptation and resilience; [3]

• GRI (Global Reporting Initiative) – specific indicators on physical, transition and adaptation risks; [4]

• CDP (Carbon Disclosure Project) – includes modules for reporting on climate risks and adaptation management; [5]

• ISO 14090 and 14091 – international standards focused on planning, implementing and evaluating adaptation to climate change. [6]

  
  

In the national context, the Brazilian Business Reporting Program on Climate Adaptation, [7] coordinated by FGVces, constitutes a pioneering initiative to support companies in identifying climate risks, in the transparent reporting of adaptive measures and in integrating adaptation into corporate governance. In addition, recent regulatory instruments — such as CVM Resolution No. 193/2023 [8] and the Brazilian Sustainable Taxonomy — reinforce the alignment between the private sector and public adaptation policies.

These frameworks encourage an approach that combines gray, green, and blue infrastructure, multi-stakeholder governance, and climate justice, amplifying the impact of business strategies on communities and ecosystems.

3. Adaptation measures for the industrial sector

Industrial adaptation requires coordinated actions involving strategic planning, innovation, and risk management. The most relevant measures include:

1. Climate vulnerability and risk assessment — physical exposure analysis of assets and supply chains; [9]

2. Diversification of inputs and logistics routes, reducing critical dependencies;

3. Resilient infrastructure — adaptation of industrial plants, drainage and energy systems;

4. Water management and energy efficiency, integrating nature-based solutions;

5. Digitalization and climate monitoring, using data and modeling to predict impacts;

6. Community and territorial engagement, strengthening the adaptive capacity of local populations.

   
   

These measures, in addition to reducing operational risks, generate a competitive advantage and attract investors concerned with long-term sustainability.

4. Financing and economic mechanisms for adaptation

Implementing adaptation strategies requires new sources and instruments of financing. Although global flows allocated to adaptation (US$ 63 billion annually between 2021 and 2022) are still below the needs, estimated at US$ 212 billion/year until 2030, according to UNEP [10] , there is increasing engagement from development banks and the private sector.

In Brazil, the following stand out:

• National Climate Change Fund (Climate Fund) [11] , which recently received contributions of R$ 10.6 billion from European banks (KfW, AFD and CDP) and the IDB, focusing on resilience and low-carbon projects;

• Blended finance mechanisms, which combine public and private capital to mitigate investment risks and attract funding for adaptation projects;

• Green Bonds and Sustainability-Linked Loans , with performance metrics tied to the reduction of climate vulnerabilities;

• Capacity-building programs, such as the Adapta Brasil System [12] and the CNI–MCTI partnerships, support the industrial sector in developing adaptation plans and managing climate risks.

  
  

These initiatives reinforce the understanding that adaptation is also an economic opportunity, capable of stimulating new businesses, green jobs, and technological innovation.

5. Paths to action

The industrial adaptation agenda demands integration between public policies, corporate governance, and financial instruments. Companies that incorporate adaptation strategically, reporting risks, implementing effective measures, and accessing climate finance will be better positioned to face the new climate and regulatory context.

The transition to a resilient economy therefore depends on an alliance between competitiveness and sustainability, in which adaptation becomes an essential part of business management and corporate social and environmental responsibility.

References: UNEP (2024); CPI (2023); CNN Brasil (2025); FGVces (2024); IPCC (2021); CNM (2024); CVM (2023); MCTI (Sistema Adapta Brasil); Climate Fund; A Economia B (2024).

[1] IPCC (2021). – Accessed at: https://www.ipcc.ch

[2] CNN Brasil (2025) – Accessed at: https://www.cnnbrasil.com.br/economia/macroeconomia/analise-desastres-custaram-r-732-bi-aos-municipios/#goog_rewarded

[3] IFRS S2 – ISSB (2023). – Accessed at: https://www.ifrs.org

[4] Global Reporting Initiative (GRI). – Accessed at: https://www.globalreporting.org

[5] Carbon Disclosure Project (CDP). – Access at: https://www.cdp.net

[6] ISO 14090 and ISO 14091. – Accessed at: https://www.iso.org

[7] FGVces (2024). – Accessed at: https://centrodeestudos.fgv.br

[8] CVM Resolution No. 193 (2023). – Accessed at: https://www.gov.br/cvm

[9] The B Economy (2024). – Accessed at: https://aeconomiab.com

[10] UNEP Adaptation Gap Report (2024). – Accessed at: https://www.unep.org

[11] National Climate Change Fund (2024). – Accessed at: https://www.gov.br/mma

[12] MCTI – Adapta Brasil System. – Accessed at: https://adaptabrasil.mcti.gov.br