Extreme weather is putting supply chains under greater pressure – but organisations are slow to respond, says the latest research from ACCA (the Association of Chartered Certified Accountants). In the week before the United Nations Climate Change Conference (COP 31) the report, Weather proofing your supply chain, finds a significant preparedness gap and shows how climate, water, resource and human-rights risks are moving into mainstream business decisions.
Although extreme weather can disrupt production, transport, labour and access to critical resources, the research found that only 10% of Africa respondents described their organisations as fully or very prepared for water-related supply-chain risks. 22% of respondents in Africa selected water scarcity or availability constraints as the single biggest water-related challenge for their organisation.
The findings highlight a growing challenge for organisations: risks that may begin with weather, natural resources, suppliers or working conditions can ultimately affect production, costs, cash flow and business continuity.
For finance professionals, the opportunity is to turn those signals into decisions — helping organisations understand where exposure sits, what it could mean financially and where earlier action can strengthen resilience. Better visibility creates more time to act and earlier action can help organisations adapt to changing conditions and build stronger, more sustainable supply chains.
The global survey of around 500 ACCA members also found that, among the sustainability-related risks assessed, respondents in Africa rated them as having a high expected financial impact on their organisations supply chain as follows:
- resource and materials scarcity 80%
- physical climate risks at 77%
- transition risks at 73%
- supply chain governance and due diligence requirements 72%.
The research points to a persistent challenge: organisations may recognise the risk without being sufficiently prepared to respond. To address this, the report identifies five ways that organisations can move from recognising risk to acting earlier:
- Understand critical suppliers, locations and resource dependencies
- Test supplier information rather than relying on declarations alone
- Use scenarios and early-warning information to anticipate disruption
- Consider the potential cost of inaction alongside the cost of resilience
- Connect sustainability evidence with procurement, investment, controls and governance
Notably 41% of Africa respondents selected better risk prediction and early warning as the most important benefit of AI and digital tools for sustainable supply chains.
The role of accountants is increasingly expanding to cover these and other sustainability risks, part of a wider redefinition of the profession. Sustainability has always been part of the ACCA Qualification, but we’re stepping that up next year when we introduce our redesigned qualification where it’s integrated at every level.
Explore the findings of the research here.
Evelyn Isioye, Regional Lead Policy & Insights – India and Africa at ACCA
