WHILE directors and other corporate leaders are generally aware of the risks of climate change, many may not understand well the specific impact that climate change will likely have on their businesses.

Failing to properly consider climate change may pose an existential risk for some companies, while others may see their profitability significantly eroded. Responsible businesses also need to consider how their operations affect stakeholders at large.

The effective oversight and management of climate risks and opportunities requires the board of directors to set the right tone, so that employees believe that sustainability truly matters and that their company addresses it effectively.