Climate Scenario Analysis and Risk Evaluation

Climate Scenario Analysis

Climate scenario analysis helps organisations understand how climate change may affect their business under different future conditions. Under AASB S2, organisations are required to assess the resilience of their strategy to climate-related risks and opportunities and disclose the assumptions and outcomes that inform this assessment.

We help organisations evaluate how climate-related risks and opportunities may influence operations, assets and long-term business performance. By considering a range of plausible future scenarios, organisations can better understand potential impacts and identify actions to strengthen resilience.

Climate scenario analysis is most effective when embedded within existing business processes rather than undertaken as a standalone exercise. We work with organisations to incorporate climate considerations into strategic planning, risk management and investment decision-making, ensuring outcomes are practical, relevant and aligned with AASB S2 requirements.

Supporting AASB S2 Disclosures

AASB S2 requires organisations to disclose the approach, assumptions and outcomes used in climate scenario analysis. We help organisations document their methodology and develop clear reporting outputs that support transparent and decision-useful disclosures.

Beyond Compliance

While climate scenario analysis is an important component of AASB S2 reporting, it can also provide value beyond compliance. By exploring how different climate futures may affect the organisation, scenario analysis can support long-term planning, inform investment decisions and help organisations build resilience in a changing climate.