logo
The $4.4 Trillion Payoff: Why Climate Action Is Smart Business

The $4.4 Trillion Payoff: Why Climate Action Is Smart Business

Forbes11 hours ago
In 2024 alone, a small group of companies unlocked a combined $4.4 trillion in financial value by acting on climate-related opportunities. These gains weren't projections,— they were realised, reported and verified through one of the world's most widely used corporate disclosure systems.
The figure comes from CDP's latest report The 2025 Disclosure Dividend, based on environmental disclosures from nearly 25,000 companies worldwide. The conclusion is clear: climate action has moved beyond risk mitigation into the realm of strategic value creation, with direct implications for corporate strategy, capital allocation, and financial performance.
As Kari Stoever, chief growth officer at CDP, explained, 'The $4.4 trillion figure represents the aggregate financial value reported by companies for already-realized opportunities. Only data where both criteria were met: (1) the opportunity had already materially affected the company in the reporting year, and (2) a specific financial value was disclosed, were included in the calculation.'
Climate Action As A Growth Engine
Extreme weather is already costing insurers $145 billion this year and rising. Climate volatility is driving operational costs, disrupting markets, and triggering new regulation. Yet companies acting on their reported data are seeing up to 2,000% ROI. CDP analysis shows companies already earn up to $21 for every $1 invested in resilience, a return better than most capital expenditure options.
More than 64% of companies identified environmental opportunities in 2024, from energy efficiency upgrades and clean energy transitions to new market entries and product innovations. Only 12% acted in the same year and reported measurable financial gains.
The upside for those still on the sidelines is significant. Companies not yet acting risk leaving $13.2 trillion in opportunities unrealised. 'The top types of future opportunities reported but not yet realized are: products and services ($7.5 trillion), new markets ($2.9 trillion), and energy source ($1.6 trillion),' Stoever said. Resource efficiency improvements were the most commonly reported but offered a smaller upside at $0.3 trillion.
Opportunity values varied dramatically by geography. Japan and Canada lead with median values of $73 million and $72 million per company, while the U.S. and China come in at $15 million and $10 million.
This variation reflects sector mix, company size, and disclosure culture more than ambition. Canada's small pool of reporting companies includes a high proportion from financial services, fossil fuels, and power generation, all high-opportunity sectors. Japan also has a high share of these sectors and a striking 97% of companies responding to investor requests, which correlates with higher reported value
By contrast, the U.S. and China have more representation from sectors such as apparel, biotech, and hospitality, which tend to disclose smaller-scale opportunities. Chinese companies also have smaller median revenues (about $800 million) constraining potential opportunity size. Reporting behaviour matters too: U.S. companies tend to report fewer opportunities and favour short-term horizons, which generally yield lower valuations.
Regardless of region, the economic upside of environmental action is no longer abstract. It's quantified, reported and increasingly bankable.
A Market Shift: Climate Risk As Investment Risk
These results land as climate risk is being woven into the architecture of global finance. Physical risks are becoming more systemic, with climate-related disasters projected to cost the world $38 trillion a year by 2050. In the UK alone, climate damage could cut GDP by 12%, a deeper hit than the financial crisis or the pandemic.
Financial institutions are responding with new tools and policies. The Institutional Investors Group on Climate Change's new Physical Climate Risk Appraisal Methodology (PCRAM) gives portfolio managers a replicable framework for assessing exposure not just at the asset level, but across interconnected systems, geographies, and value chains. The logic is straightforward – climate resilience now carries a measurable premium in investment terms.
That shift is now becoming visible in monetary policy. In July 2025, the European Central Bank announced it will begin adjusting the value of corporate bonds used as collateral in its refinancing operations based on climate vulnerability, using a climate factor. From the second half of 2026, bonds exposed to higher transition risk, whether due to sector, issuer, or maturity profile, will face valuation haircuts.
'By integrating climate risk into our collateral framework, we are safeguarding the Eurosystem against future shocks and encouraging banks to shift towards more sustainable investments,' said Christine Lagarde, president of the ECB in a statement. 'This is a necessary step to ensure financial stability in a changing world.'
In other words, resilience now has an identifiable return. The message is to treat disclosure data like any other capital-allocation input, not a CSR checkbox, reframing climate action not as an expense, but as a source of measurable business value.
For companies, the implications are profound. Access to capital will increasingly depend on credible climate strategies, and the cost of inaction will show up not just in physical damage or lost market share, but in bond valuations, insurance terms, and investor relations.
These firms are also aligning with evolving regulations such as the EU's Corporate Sustainability Reporting Directive and new global standards from the International Sustainability Standards Board. But regulation isn't the only driver: customers, employees, and investors are all pushing for credible action.
The value is especially pronounced in sectors where environmental risk intersects with core business models, such as energy, agriculture, manufacturing, logistics, and consumer goods. Investments in nature-based solutions, emissions reduction, and climate adaptation can reduce exposure while generating new revenue streams and cost savings.
Stoever notes that sustainable products are already outperforming peers by up to 25% in revenue. Companies tackling Scope 3 emissions have saved $13 billion, with $165 billion more achievable at a cost of just $94 billion. 'This isn't ESG,' she says, 'It's economics. Disclosure and action are not just risk management tools; they are strategic levers for growth, efficiency, and long-term value creation.'
Despite the compelling data, many companies remain slow to act. While 90% of large firms disclosing through its platform have processes in place to identify and assess environmental risks and opportunities, fewer than half have a credible climate transition plan.
The reasons are familiar: short-term shareholder pressure, limited capacity to manage climate data, and fear of revealing vulnerabilities. SMEs and Global South companies face additional hurdles, from restricted access to transition finance, lack of technical support, or insufficient regulatory clarity.
'These obstacles are real but increasingly surmountable,' Stoever notes. 'As financial institutions, central banks, and governments integrate climate risk into their decision-making frameworks, the tools, capital, and incentives to act are becoming more accessible.' The real gap, she says, is in governance and leadership, aligning CFOs, sustainability leads, and capital allocators, and moving beyond incrementalism to recognise climate resilience as a driver of long-term value.
'Environmental risk is financial risk,' she says. 'Boards and CFOs must shift from viewing environmental data as compliance to treating it as capital strategy.'
Call to Action: Translate Insight Into Impact
'The core insight of The 2025 Disclosure Dividend is that value comes not from disclosing climate risk, but from acting on it,' Stoever says. 'Companies must move quickly from data to decisions, and from decisions to execution. The winners will be those that understand climate data not as a compliance burden, but as an investment signal, a lens through which to identify upside, safeguard continuity, and unlock future markets.'
The message from CDP's report is unambiguous: disclosure is the beginning, not the end. Data alone has no financial impact until it is embedded into core business decisions, capital allocation, procurement, product design, and strategic planning.
This is no longer a sustainability team's sole domain. Boards must treat climate strategy as a fiduciary responsibility. CFOs and risk officers should integrate climate metrics into financial modelling, while investors must hold companies accountable not only for what they report, but for what they do. Policymakers must ensure disclosure frameworks lead to real-world outcomes through just transitions, adaptation finance, and systemic accountability.
'For every $1 a company invests in climate risk mitigation, it could see up to $21 in return,' Stoever said. 'Climate action isn't a cost centre; it's a growth engine.'
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

Save Up to $250 and Get Free Gifts With OnePlus' Back-to-School Sale
Save Up to $250 and Get Free Gifts With OnePlus' Back-to-School Sale

CNET

time21 minutes ago

  • CNET

Save Up to $250 and Get Free Gifts With OnePlus' Back-to-School Sale

It's back-to-school season and there's no question that today's educational system requires tech to get by. From making it easier to take notes, do homework or research, having the right gear is helpful. If you're a fan of the Android, you know that Samsung and Google are some of the best brands out there. However, OnePlus gear isn't to be overlooked. They too have stellar cameras, top-notch security features and exciting AI features. OnePlus' back-to-school deals last from August 11 to September 1. These deals are great for anyone trying to keep an eye on their budget or who might have tariff concerns. OnePlus also offers discounts with trade-ins, free gifts with select purchases and free shipping on any order above $100. We've rounded up some of their deals by category. Plus, students get up to an extra 10% off. OnePlus Back-to- School deals OnePlus 13 (256GB): $750 The OnePlus 13 smartphone offers a 50MP back camera, 12GBRAM and 256GB SSD. The phone is equipped with a NanoStack battery, lets you capture videos in 4K resolution and is both IP68 and IP69 waterproof. Your purchase also includes one free gift, and you choose from a leather case or a pair of OnePlus Buds 3. Need more storage space? You can grab the 512GB version of this phone for $150 off, which brings it down to $850. Plus, OnePlus has a trade-in program that lets you save up to an extra $100 off. Details Save $150 $750 at OnePlus Close OnePlus Watch 3 (46mm): $320 The OnePlus Watch 3 and won our CNET staff over thanks to its long battery life, tough titanium alloy bezel and wellness trackers so you can keep better tabs of your health. It's now $30 off and you can score up to an extra $50 off if you have an eligible device to trade in. Plus, students save an extra 10% off the sale price. Details Save $30 $320 at OnePlus Close OnePlus Buds Pro 3: $150 If you need an alternative to pricey AirPods or Beats earbuds, then OnePlus Buds Pro 3 are a solid have dual drivers, stellar sound and noise canceling up to 50 decibels so you can focus. Your purchase includes a USB-C charging cable and ear tips so you can get the best possible fit. Details Save $30 $150 at OnePlus Close OnePad Pad 3: $650 The OnePlus Pad 3 is the latest tablet OnePlus has to offer. It's equipped with the Snapdragon 8 Elite CPU for speedy and reliable performance, 3.4K resolution and it's only 5.97mm wide, making it ultra-slim and easy to carry. Plus, you can choose one free gift with your purchase. Choices include the OnePad 3 Folio case or the OnePlus Stylo 2. Students can get an extra 10% off. Details Save $50 $650 at OnePlus Close More OnePlus Back-to-School deals OnePlus has a few more deals up their sleeve, and you have until September 1 to consider your options. OnePlus has a 15-day return policy and offers discounts on bundles with certain purchases. Looking for back-to-school deals but not sure if any of these are for you? Check out our list of the best back-to-school gear and gadgets so you can find what works for you. Why this deal matters OnePlus offers fantastic Android gear with all of the trimmings: clear cameras, beautiful display, AI features and waterproof build so you can get your work done anywhere. On top of discounts of up to $250, students can save up to 10% off and anyone with a device to trade in might qualify for extra savings on certain purchases.

Autonomous Agents Are Revolutionizing Software As We Know It
Autonomous Agents Are Revolutionizing Software As We Know It

Entrepreneur

time21 minutes ago

  • Entrepreneur

Autonomous Agents Are Revolutionizing Software As We Know It

Autonomous agents are the new product strategy for SaaS. Opinions expressed by Entrepreneur contributors are their own. Let's be honest, most SaaS updates today are still "smarter features." Better dashboards, improved AI summaries and predictive filters that shave off seconds from workflows. They're helpful, but … they're still passive. However, most of these features still depend on users knowing what to do. Autonomous agents change this equation. Let's explore why autonomous agents are becoming the new operating layer of SaaS. Related: From Co-Pilot to Co-Worker: Where the AI Assistant Journey is Headed to Next Autonomous agents: The new growth layer for SaaS Autonomous agents are systems that decide and act instead of simply responding to user actions. They're software entities designed to interpret goals, make decisions and take action on their own. Instead of "How can we help users complete tasks faster?" We ask, "What tasks can the product handle on its own?" Smarter features are reactive. They rely on user input to trigger a defined outcome. A predictive tag sorter remains inactive until you manually upload or categorize new data. Recommendation engine generates suggestions only after you've provided enough browsing behavior to inform its model. Automated test scripts validate expected behavior, but often fail when faced with unexpected inputs or dynamic UI changes. CI pipeline trigger runs tests on schedule or commit, but doesn't monitor environmental factors or adapt based on risk levels. Autonomous agents operate like collaborative teammates, navigating complexity and ambiguity on your behalf. They can: Analyze a backlog, identify dependencies and sequence upcoming releases Monitor user behavior, detect churn risk and initiate personalized retention flows Orchestrate test automation across environments, handle failures and self-optimize coverage This represents decision intelligence built into next-generation software, not just feature intelligence. Related: Insights on the Impact of AI in the Vertical SaaS industry Where agents are already changing SaaS DNA Autonomous agents are already embedding themselves across the software stack: DevOps platforms: Deployment agents monitor post-release metrics and trigger rollbacks before issues escalate. Customer success systems: Retention agents proactively trigger support playbooks when churn risk is detected. Marketing tools: Budget optimization agents dynamically shift ad spend across platforms based on performance, requiring no manual approval. They're goal-driven decision makers with embedded memory, context awareness and execution autonomy. Why autonomous agents drive product adoption When SaaS products integrate autonomous agents, they help with user stickiness and adoption beyond what was previously possible: 4x uplift in code deployment: Noibu accelerated its code deployment frequency by 4x using LambdaTest's autonomous agenting testing, streamlining releases and enabling quicker, high-quality updates. 45% faster time-to-value: Agentic automations have shaved onboarding time by up to 45%, accelerating value realization and reducing early user drop-off. Improved user engagement : Products integrating autonomous agents report 60–80% faster workflows, with agents that automate repetitive tasks seeing higher regular usage frequency and improved retention. Active user growth (DAU/MAU): DAU/MAU growth reflects increased stickiness; agents that automate repetitive tasks see higher regular usage frequency. Higher customer satisfaction scores (CSAT & NPS): 55% of SaaS users say that personalization powered by agents influences their decision to remain active; 60% are more likely to recommend agent-enabled products. Why SaaS needs to make this leap now Markets are shifting. AI-native companies are launching with agent-first frameworks. User expectations are evolving. Gen Z and millennial teams want outcomes, not toolkits. Investor narratives are increasingly focused on intelligent automation and productivity expansion. Autonomous agents represent a fundamental strategy that redefines user expectations from software. SaaS founders and product leaders who embed agents into their platforms will build intelligent collaborators to take on complete responsibility and execute with purpose in the near future. Related: What You Need to Know About 'AI Agents' and Why We Are One Step Closer to The Jetsons Think beyond smarter features Smarter features help users work better. Autonomous agents let them stop working on what doesn't matter. This goes beyond bots, automation scripts or background tasks. It's about building SaaS platforms that actively participate in solving problems without constant instruction. The future winners in SaaS will build software that thinks, decides and acts as a true partner in getting work done, rather than just offering faster filters or better dashboards. Autonomous agents represent the next evolution in software. The transformation has already begun.

The Nvidia Chip Deal Helps China Achieve Its AI Goals
The Nvidia Chip Deal Helps China Achieve Its AI Goals

Bloomberg

time22 minutes ago

  • Bloomberg

The Nvidia Chip Deal Helps China Achieve Its AI Goals

In 2017, China outlined its plan to make the country the dominant global force in artificial intelligence by 2030. President Xi Jinping provided the will and the funds to move quickly, ramping up homegrown semiconductor manufacturing, data center construction and a power grid to support it. But one thing had been holding it back in its fight with the US — reduced access to the best American-designed semiconductors. The White House has given up at least some US advantage in return for a 15% cut of the sales of AI chips to China by Nvidia Corp. and Advanced Micro Devices. While President Donald Trump is wrong when he says Nvidia's H20 chip is 'obsolete,' it's right to note that it is not close to being the company's most powerful one and would not be used by the likes of OpenAI to build their most sophisticated models. The H20 was designed specifically to avoid previous export limits and is better suited to 'inference' — the running of AI — rather than 'training' — the creation of new models. The fact the H20 was cleared for sale, then not, and is now back again is proof enough that much of this is 'just theater and negotiation,' suggested leading semiconductor analyst Patrick Moorhead, who consulted with the current White House on this issue. The same appears to go for any concerns about national security threats.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store