What’s Inside

Extreme weather events are on the rise, and global supply chains are bearing the cost. From the 2023 Panama Canal drought that delayed shipping across a critical waterway to Thailand floods that shut down electronics manufacturing to California wildfires that destroyed transportation networks, climate change supply chain risk has become an immediate operational reality. According to a 2022 Accenture and UN Global Compact study, nearly half of all CEOs report that extreme weather events are already disrupting their supply chains.

In “Climate Change Risk and Supply Chains,” researcher Sara Hsu of the University of Tennessee’s Global Supply Chain Institute—collaborating with engineers Joshua Fu and Andrew Ferrada as part of an Advanced Supply Chain Collaborative (ASCC) project—draws on original data and global climate indicators to introduce a first-of-its-kind Climate Change Index that scores 64 countries across physical and transition risk dimensions. Built on the TCFD’s widely used risk classification and validated against Yale’s Environmental Performance Index and Notre Dame’s Global Adaptation Initiative, the index gives executives a structured, data-driven tool for making location, sourcing, and investment decisions.

Because physical and transition risks create feedback loops that amplify one another, the index is designed to give leaders a holistic view of country-level exposure. Additionally, the paper includes a dedicated section on the ROI of climate risk mitigation, examining how proactive investment in resilience, renewable energy, and supplier diversification can reduce costs and improve long-term profitability.

Download to Explore

• The GSCI Climate Change Index — country-level risk scores for 64 countries across physical and transition risk dimensions
• Key findings: why Denmark, Norway, and Canada rank highest; why Bangladesh, Indonesia, and Egypt rank lowest
• Why countries facing the most climate disasters don’t always rank worst and what that means for sourcing decisions
• The ROI of proactive climate change supply chain risk mitigation
• Practical strategies for building resilience against both acute weather events and long-term climate shifts

Who This White Paper Is For

This white paper is designed for:

• Chief Supply Chain Officers and Senior Operations Leaders
• Global Sourcing and Procurement Leaders
• Supply Chain Risk and Resilience Managers
• Chief Sustainability Officers and ESG Leaders
• Supply Chain Professionals and Advanced Students

For more in‑depth, industry‑focused white papers from the Global Supply Chain Institute (GSCI) at the University of Tennessee, Knoxville, visit our white papers library. Recent research produced by the Advanced Supply Chain Collaborative (ASCC) engages industry leaders and UT faculty to explore and report on leading‑edge practices in supply chain management, planning, and innovation.

Watch a video interview series between author Sara Hsu and senior supply chain leaders from Dollar General, Stanley Black & Decker, Vertiv, Dollar Shave Club about their challenges and how they’re overcoming them