Engineering and design teams are increasingly looking to embed climate risk into their operations and outlook to improve resilience. This shift from mitigation to adaptation promises to change company strategy while building value for business. 

As blizzards pummel North America and rivers across France flood, we see the importance of protecting our infrastructure and ensuring resilient supply chains clearer than ever. Companies are recognizing that the time to rethink operations and incorporate climate risks is now. In conversations with leaders from across industries, I have been hearing about the necessity of building resilience into our systems and design processes. This takes many forms – from diversifying supply chains and updating our risk models to creating tailored crisis management plans. Mitigation is no longer sufficient – we need to adapt to our new climate reality. 

This priority comes through clearly in Capgemini’s recent engineering and R&D trends survey, which breaks down what business leaders are thinking and what actions they are taking today. This survey also helps highlight the power of a forward-thinking vision to transform business operations for the 21st century, turning climate-driven risks into business opportunities. 

Addressing growing climate risks  

Today, intensifying climate risks are creating volatility for businesses. Extreme weather events are becoming more frequent, posing danger to global infrastructure and threatening disruptions to supply chains. A study by the Potsdam Institute for Climate Impact Research (PIK) estimates that, by 2049, climate change could cost the global economy approximately $38 trillion annually, with a projected range between $19 trillion and $59 trillion. At the same time, businesses are scrambling to keep up with new environmental regulations at both national and international levels. Market expectations fluctuate continually amid these other factors, affecting business outlooks. For executives, the most pressing concerns are maintaining operations during extreme weather events (76%); sourcing materials or parts (74%); and meeting regulatory and disclosure requirements (73%). 

In our recent engineering and R&D trends survey, we talked to executives about how climate risks are impacting their business outlooks. 69% of those interviewed cited supply chain disruptions as a major risk, with infrastructure damage and loss close behind. Raw material scarcity, energy insecurity, and water scarcity also featured as primary concerns. These risks already impact businesses today. The question is how to respond. 

Building resilient systems 

Although these climate-driven challenges present serious risks to the business world, they also represent an opportunity to transform engineering and R&D strategies and operations. Companies can already start to prepare by investing in resilient materials, systems, and product designs that can withstand environmental stress. Installing smart systems to track and optimize water and energy usage, designing early warning systems, and creating strategic redundancies can ensure continuity in business operations even after extreme weather events. 

Teams must look to build new capabilities to respond to these risks. Scenario modeling allows businesses to plan for unforeseen events like rising material costs or supply chain disruptions from the first stages of any new project. Climate-informed design standards can enable resilience by accounting for larger temperature ranges, heavier rainfall, and increased exposure to wind and other weather conditions. And cross-functional collaboration with finance, risk, and strategy teams can help ensure that businesses can stay flexible and adaptable as conditions evolve.  

Driving sustainable transformation 

Adaptation and resilience are necessities in a new global business context, and they represent an opportunity for innovation. New design principles that account for climate risk in projects can bring knock-on benefits. For example, creating more efficient industrial processes can lessen energy and material intensity, while also cutting costs. Shifting to renewable energy to power business operations decreases emissions and can shore up local energy security. In general, building adaptable systems can create long-term strategic flexibility for businesses, enabling us to respond quickly to new circumstances.  

I know that leaders in today’s complex environment face serious obstacles in addressing the risks of climate-related events, but we have the necessary tools to build a more adaptable, resilient and innovative future. 

Read the rest of our Engineering and R&D Pulse 2026 report.