Impacts to Inputs
Explore where input risks can arise, how they can affect business performance, and what businesses are already doing to respond.
Every business relies on key inputs to produce goods, deliver services, and keep day-to-day operations running. These may include water, energy, raw materials, land, data, labour, ingredients, packaging, equipment, or other essential resources.
Climate and nature risks can make these inputs harder to access, more expensive, less reliable, lower quality, or unsafe to use. This can affect operations, supply chains, costs, customers, and long-term growth. And these risks can affect business inputs in different ways. Some risks are sudden, such as floods, storms, wildfires, or heatwaves. Others build gradually, such as water stress, rising temperatures, soil degradation, biodiversity loss, or changing disease patterns.
Priority Inputs
Understanding the vulnerability of Key Business Inputs
Exposure: Where inputs come from matters
Exposure is about where inputs, suppliers, workers, sites, and transport routes are located, and whether those places are likely to be affected by climate or nature risks.
A business may not be directly hit by a flood, drought, or wildfire, but it can still be affected if its suppliers, workers, materials, water sources, or transport routes are exposed.
A business may be more exposed if it relies on:
- Water from drought-stressed rivers, lakes, or groundwater sources.
- Crops grown in heat-exposed, flood-prone, or water-stressed regions.
- Materials moved through ports, coastal roads, or low-lying industrial sites, where flooding, storms, sea-level rise, or erosion can disrupt key transport and storage routes.
- Supply chains in mountain or glacier-fed regions where seasonal water flows are changing.
- Forests, farms, fisheries, or rangelands affected by wildfire, soil degradation, invasive species, disease, or biodiversity loss.
- Workers who have to travel through, or work in, unsafe heat, smoke, flood, or storm conditions.
Understanding exposure helps you see where disruption is most likely to start.
Sensitivity: Why some inputs are easier to disrupt
- Crops, timber, fibres, livestock and fish can be affected by heat, drought, floods, pests, disease, soil degradation, and changing seasons.
- Water-dependent operations can be disrupted when water becomes scarce, polluted, too warm, or too expensive.
- Energy systems can be affected when heat, drought, storms or floods disrupt power generation, cooling, fuel supply, or electricity networks.
- Workers can be affected by heat stress, wildfire smoke, flooding, unsafe travel, disease risks, and repeated disruption after extreme weather.
Systemic amplification: One disruption can trigger others
Climate and nature risks can affect an input directly. But the business impact often grows
because that input is connected to other suppliers, services, infrastructure, contracts, and markets.
This means a disruption that starts in one place can quickly create knock-on problems elsewhere.
For example:
A shock in one key sourcing region can affect global supply.
A drought does not only reduce water supply.
A flood does not only damage one site.
Market and policy responses can add further pressure.
Adaptive Capacity: How to protect key inputs
Climate and nature risks can affect the essentials businesses need to keep running—including water, energy, materials, and labour. The aim is not to solve every risk at once, but to understand which inputs matter most and where action would make the biggest difference.
Businesses are already taking practical steps to protect the inputs they depend on. For example, they are:
- Keeping water available, affordable and fit for use by reusing water, improving efficiency, restoring catchments, and working with suppliers to reduce water demand.
- Keeping energy reliable, affordable, and available by investing in renewable energy, microgrids, storage, efficiency, and flexible systems that can keep operations running during disruption.
- Protecting workers from heat, smoke, floods and disease by adapting working hours, improving rest and shade, providing protective equipment, strengthening health support, and planning for emergencies.
- Securing raw materials by working with suppliers, improving traceability, using regenerative sourcing, redesigning products, increasing recycled content, and finding lower-risk alternatives.
