Foreword The impacts of climate change on business are no longer distant threats. They arehere today. Climate-related impacts manifest through sudden shocks like damagedinfrastructure and disrupted supply chains, and simultaneously through chronic risks likereliable access to water or increased heat stress. They translate into less predictablerevenues and rising costs, creating a wicked risk-multiplier for the company on top ofan already uncertain operating environment. Increased physical risk is exacerbatingexisting business risks and financing costs and oftentimes can feel uncontrollable. Tobecompetitive, a leading business must adapt. The increasing frequency and severity of physical risks is disrupting our way of life.Adaptation is no longer a choice. It is a necessity. But governments cannot addressthis challenge alone. Businesses have a vital role in building the resilient systems oursocieties urgently need. To be effective, our efforts must be aligned. National Adaptation Plans must bematched by business adaptation plans that take into account the collective resilienceof both businesses and communities. We need coherent strategies to make surethat today’s investments reduce future losses and protect livelihoods and long-termcompetitiveness. Adaptation isn’t just about risk avoidance, however, it can also be an opportunity. Whena company invests in adaptation to climate change, it helps build the resilience of itsemployees, its operations, and the communities it operates in. It contributes to morepredictable and, as a result, more competitive supply chains. Investing in resilience alsoopens the door to technology and operational innovation, smarter, more predictiveplanning, and long-term value creation. This guidance, developed by WBCSD in collaboration with business leaders andadaptation experts, arrives at a critical moment. It establishes a practical approachfor companies to assess climate risk, design adaptation solutions that strengthenresilience, and contribute meaningfully to global adaptation goals, most notably theSharm-El Sheikh Adaptation Agenda’s call for 2,000 Business Adaptation Plans by 2030. But this work is not something a corporate sustainability team can do alone. Adaptationmust be integrated into core business strategies—across risk, finance, procurement, HR,and R&D functions.To maintain competitive edge, investment in resilience is requiredacross operational functions today and must be integrated into company transitionplans for the future. I welcome this timely and valuable resource to help businesses embed adaptationand resilience into decision-making, and to foster stronger collaboration betweengovernments and businesses to deliver a more resilient world for us all. This new guidance from WBCSD, created with insights from 70 global business andadaptation experts, is the first, unique step in making “adaptation mainstreaming”operationally possible across a company. Carefully designed by business practitionersfor business practitioners, it is a practical, action-oriented guide that supports businessmanagers wherever they are on their adaptation journey. Dan IoschpeClimate High-Level Championfor COP30 I would like to thank all the WBCSD member companies, our team and all the expertswho took part in the important work to produce this guidance. As you deploy thisguidance into your business operations, we welcome your feedback so that we canfurther iterate and refine the content. Dominic WaughrayExecutive Vice President, WBCSD Tableof contents Introduction0401. 24 3.1 Developing an internal library ofadaptation solutions24 5.1 Creating a monitoring andevaluation framework47 3.2 Understanding maladaptation28 5.2 Designing adaptation metrics48 1.3 Linking Adaptation and Transition Plans07 5.3 Evaluating the overall resilience ofthe business51 3.3 Identifying opportunities for collectiveresilience building initiatives30 Setting the Scopeand Adaptation Goals0802. 5.4 Monitoring the effectiveness ofimplemented adaptation solutions53 3.4 Establishing a company-wide frameworkfor assessing adaptation solutions31 3.5 Considering the timing of risk vs thetiming of solution implementation34 2.1 Establishing the business case foradaptation planning08 Call to Action: Risks areOpportunities in Disguise5806. 3.6 Managing uncertainty and long-term risksthrough adaptation pathways36 2.2 Analyzing risk assessments andprioritizing actions11 3.7 Financing adaptation solutions38 2.3 Aligning stakeholders and securingplanning resources15 Annexes6007. Building the Plan andImplementing AdaptationSolutions3904. 2.4 Setting adaptation goals20 2.5 Creating an outline adaptation plan23 Annex 1: Glossary of Terms60 Annex 2: Example Adaptation Plan on a Page62 4.1 Defining an investment roadmap foradaptation solutions39 Annex 3: Additional Resources63 4.2 Building the plan40 4.3 Integrating adaptation planning withexisting processes43 4.4 Piloting adaptation solutions44