Relationship Managers as Drivers of Climate Transition - A Journey : Climate Risk Is Already Impacting Businesses Today!!
When we talk about climate risk, many people still think about long-term scenarios decades away. But for many businesses, climate risk is already affecting operations today.
We are seeing: 🙅♀️ More frequent flooding 🙅♀️ Extreme heat conditions 🙅♀️ Water shortages 🙅♀️ Supply chain disruptions 🙅♀️ Rising insurance costs These are not just environmental issues. They are business issues.
Consider a warehouse operator located in a flood-prone area. A major flood event could result in: ❌ Damaged inventory ❌ Operational downtime ❌ Delayed customer deliveries ❌ Higher insurance costs ❌ Cash flow pressures If the disruption is prolonged, the business may also face difficulties meeting its loan repayment obligations. What starts as a climate event can quickly become a financial issue.
This is why Relationship Managers (RMs) should not only focus on a customer's financial performance, but also understand the resilience of their operations.
Some useful questions include: 🔹 Are critical facilities exposed to flood risks? 🔹 Does the business have backup suppliers? 🔹 Is there a business continuity plan in place? 🔹 How quickly can operations recover after a disruption? 🔹 Are key assets adequately insured?
These conversations help customers think beyond immediate business needs and prepare for future disruptions. In many cases, resilience-building measures such as: ✔ Flood mitigation improvements ✔ Backup power systems ✔ Alternative suppliers ✔ Emergency response procedures ✔ Business Continuity Management (BCM) ........can reduce operational disruptions and strengthen long-term business sustainability.
Guided by Bank Negara Malaysia’s CCPT, Relationship Managers have an opportunity to move beyond financing discussions and help customers build resilience against climate-related risks. Because sometimes the most important question is not: ❓ "How profitable is the business today?" But rather: ✅ "How well can the business withstand tomorrow's disruption?"
And increasingly, one of the most valuable roles an RM can play is helping customers find the answer/s.
