Methods for Evaluating the Climate Change Risk on Companies Supply Chain

Each economic sector in the United States is directly or indirectly impacted by weather and climate events. According to the National Oceanic and Atmospheric Administration’s list of billion-dollar disasters since 1980 there have been 363 disasters costing more than 2.5 trillion dollars. In 2022 alone there were 18 disaster events costing more than 177 billion dollars. Climate and weather phenomenon have a significant impact on a business operation from temperatures impacting employee health to severe weather events inducing power outages. However, these are not the only impacts that can cause disruptions. Suppliers play a critical role in ensuring the delivery and production of materials for businesses to create their products. As our climate continues to change it is vital for businesses to prepare for disruptions from weather/climate events. However, the general or large-scale assessments of weather/climate risks are insufficient for a company focusing on a specific site’s supply chain. Therefore, it is necessary to conduct a climate risk assessment based on geographic information about a specific site and its suppliers, as well as the routes between them. The objective of this project is to define methods for evaluating climate risk for a company facility and its supply chain. These methods will show how to evaluate risk for precipitation, wind and severe weather events using CMIP6 model data.