Business enterprises will have to keep aside an increasing share of their cashflows to counter rising climate risks, pushing up the costs for small businesses in the future. For instance, rising sea levels, wildfires, and hurricanes impose costs on firms in terms of having to prepare and respond to them. As those risks are inevitable, such costs are set to surge over time. Appropriate risk management strategies will ensure adequate funds to address various aspects of growing climate risks. However, having to invest in those strategies also imposes costs. For instance, property damage, revenue loss, and insurance policy premiums impose high costs on small businesses.
