From transition to resilience: why climate adaptation is becoming a business priority

This summer's heatwaves across Europe offered another reminder that climate change is no longer a future challenge. Businesses across the continent faced pressure on energy systems, disruption to transport and logistics networks, and growing questions about the resilience of critical infrastructure.

For many companies, the conversation is changing. While reducing emissions remains essential, attention is increasingly turning to another question: how can businesses prepare for the physical impacts of a changing climate?

As a result, climate adaptation is moving higher up the corporate agenda, alongside decarbonisation.

At ING Wholesale Banking, we are seeing climate resilience become a much more prominent theme in conversations with clients. Companies are increasingly assessing how physical climate risks could affect their assets, operations and supply chains, while identifying investments that can strengthen resilience over the long term.

This trend is evident across sectors:

• Energy companies are investing in infrastructure that can support a more resilient and increasingly electrified energy system.
• Real Estate companies are exploring how buildings can better withstand heat stress and extreme weather. Infrastructure operators are assessing how transport, logistics and utility networks can adapt to changing climate conditions.
• In Food and Agriculture, clients are exploring more sustainable land-use practices, water management and climate control measures to better accommodate livestock, and to enhance the resilience of productive landscapes, preserving soil capital, and protecting long-term crop yields. Especially for this sector, value chain resilience is an imperative.

In many cases, climate adaptation is no longer viewed solely as a sustainability issue. It is increasingly seen as a business resilience issue.

The challenge is significant. Across Europe, companies are already experiencing more frequent and intense weather-related disruptions. Extreme heat, drought, flooding and water scarcity can affect everything from energy generation and industrial production to transportation and agricultural output. According to a Opens in a new tabrecent study from the European Commission, EU needs to invest €70 billion per year in climate adaptation up to 2050.

These developments are also reshaping investment priorities.

Peter Kindt, Global Head of Sustainable Solutions Group, says:

Sustainable finance is entering a new phase of growth. The market may be evolving, but the need to finance the energy transition, strengthen infrastructure, support innovation and build resilience to a changing climate remains as strong as ever.

Recent events have highlighted how closely resilience and transition objectives are connected. During this summer's heatwaves, power prices across parts of Europe rose sharply as low water levels reduced hydropower generation in the Nordics and high river temperatures constrained nuclear generation in France and Belgium. The episode served as a reminder that building a lower-carbon energy system is not only about expanding renewable generation. It is also about ensuring that critical infrastructure can remain reliable under changing climate conditions.

This is why investments in electricity grids, transmission networks and energy infrastructure remain so important. A resilient energy system is essential for supporting economic growth, enabling electrification and strengthening energy security. Increasingly, it also depends on effective water management and broader climate adaptation measures.

Financial institutions have a role to play in helping clients navigate this evolving landscape.

Arash Mojabi, UK Head of Sustainable Solutions Group at ING, says:

Climate adaptation is still a relatively new consideration for many businesses. While some clients are beginning to look beyond immediate risks and ask how they can protect assets, strengthen supply chains and maintain competitiveness over the long term, others are only starting to assess what physical climate risks could mean for their operations. Sustainable finance can support that journey by helping turn credible resilience plans into financing solutions, alongside the continued transition to a low-carbon economy.

Financing is important, but so is combining capital with sector expertise and strategic insight to help businesses understand emerging risks and identify opportunities to strengthen resilience.

The opportunity extends beyond risk management. The investments needed to adapt economies to climate change are expected to drive demand for new technologies, upgraded infrastructure and more resilient business models. Areas such as water management, flood protection, climate-smart agriculture and resilient infrastructure are likely to become increasingly important in the years ahead.

The companies that act early will be better positioned to navigate uncertainty, protect assets and long-term value, and remain competitive as climate risks become more visible.

For ING Wholesale Banking, supporting clients through both the low-carbon transition and the growing need for climate adaptation will remain a key focus. Increasingly, the two are inseparable. The transition to a more sustainable economy depends not only on reducing emissions, but also on building the resilience needed to thrive in a changing climate.