Urgency to act on climate becomes acute in a heatwave

With acuteness comes clarity. Conversations are shifting away from the ‘busy-ness’ of climate action towards business vision. The dust is settling on routine tasks and the shift towards a new era with defined aspirations is now urgent.

Away from central stages at LCAW 2026 conversations could be heard about new efforts that focus less on top-down initiatives from regulators and standard-setters; and more on individual company business models, specific markets, real-life supply chains, defined sectors and focused grassroot action being funded and scaled to deliver positive outcomes in relation to climate.

Much of this revolves around the scaling of technologies to deliver the new economy; but it also relies on funding – including philanthropic funding – and putting capital to work in ways that deliver across stakeholders, including investors, communities and people struggling in heatwaves, floods and with compromised health.

It’s about business fundamentals

Ultimately, climate is interwoven into business success – whether that is acknowledged or not. We have seen this week what red warnings do to the infrastructure we rely on to operate, and what happens to our ability to succeed when they are compromised.

Volatility is an unwelcome business bedfellow. No market thrives on unpredictability; and even the disrupters have settled into rhythms and routines with predictability at their core.

Whatever drives a business forward – investor returns, purpose, growth or a combination of these and other drivers – these business propellants are always about delivering business value and making good capex decisions to do so. Climate must be part of business success; not a reason for business failure. And it must be spoken about in terms of strategy: the strategic plan and the transition plan are the same plan.

Oversight of all this sits firmly in the boardroom. Business value and decisions about capital allocation are boardroom topics. It is the board (populated by portfolio non-executive directors who form a community across economies) that brings its judgment to bear in relation to value and capital allocation. That judgment will be coloured by climate.

It’s also about consequences

Failure to act is already having consequences. While the physical risks are real, and the financial risks are already being documented (especially by actuaries), the legal risks are looming.

This puts lawyers in the frame. All business leaders know it’s not possible to build an operating environment that is free of risk. And a totally risk-averse business mindset is not useful to investors looking for growth anyway; but legal risk around climate is real.

This means boards will increasingly work in concert with legal advisers who will have to learn about individual business models if they are to understand specific company climate risk. Again, we are moving away from the generic (compliance-oriented action) and towards specific action on climate.

Understanding litigation risk is vital – especially in the UK where funding for class actions is increasingly available. While litigation might not be successful, it’s a distraction and costly; and damage to reputation is real.

Crisis communications experts and lawyers are two cohorts that will become increasingly familiar to boards; and they will become intrinsic to upskilling boards to the appropriate levels and types of competencies.

Change the system; change the outcomes

While conversations at LCAW were peppered with stories of business model, sector and market approaches to climate, the elephant in the room is always the system. The grid is not up to snuff, policy is lagging business action, we are stuck with Victorian infrastructure in the UK, land use is problematic, there is never enough affordable energy, and so on.

So, boards will have to have courage, focus both on the detail of climate action and on the big picture, and individual non-executive directors will not only be thinking about business value but also considering their legacy.

Decisions made now will either secure business value or damage it. Overseeing that process is of historic importance.