Turning climate risk into business resilience in the fresh food industry: Integrating climate threats into your risk matrix

By 2050, more than 70% of the UK’s top 10 source countries for fruit and vegetables will face extreme water stress. Climate change is no longer a distant threat – it’s reshaping the economics of global food supply today. Droughts in Spain, floods in Egypt, and record heat in South Africa are no longer isolated events. They’re part of a global pattern that threatens not just yields, but the continuity, cost, and reliability of supply chains we depend on every day.  

The new face of business risk 

For businesses in the fresh food sector, the challenge is clear: climate change is not just an environmental issue. It’s a business risk.

Yet, despite mounting evidence, many risk frameworks still overlook climate exposure. Traditional risk matrices – designed to measure operational or financial hazards – were not built to account for the volatility of a changing planet. To build resilience and protect margins, fresh food businesses must now bring climate risk into the same structured decision-making process as logistics, finance, and compliance.  

When climate becomes a supply chain risk 

The UK imports 84% of its fruit and nearly half of its vegetables each year, mostly from countries already suffering from rising temperatures, water scarcity, and flooding. Spain, Morocco, South Africa, and Egypt – all major suppliers – are seeing agricultural regions pushed to their climatic limits.

This dependence exposes British retailers, importers, and processors to vulnerabilities that go far beyond seasonal fluctuations. When drought grips the Agadir region of Morocco or flooding hits the Nile Delta, UK supermarket shelves, prices, and long-term supplier relationships all feel the shock.

Climate change is undermining predictability – the foundation of modern food supply chains. The risks once considered “force majeure” are now foreseeable and modelled. And as temperature and water data become increasingly granular, it’s possible – and necessary – to measure these risks with business precision.

Put simply: if your supply chain depends on the weather, climate change is your biggest supplier risk.  

Why your risk matrix must evolve 

Most companies already use a risk matrix to plot the likelihood and severity of potential disruptions – from cyberattacks to commodity price swings. But climate risk rarely appears on that chart, even though it amplifies nearly every other business vulnerability.

What’s missing is climate-linked exposure: the probability that an environmental event – drought, heat stress, flood, or policy change – will directly impact your operations or suppliers. This isn’t theoretical. It’s measurable, modelled, and increasingly required to be reported by businesses under emerging standards such as the Task Force on Climate-related Financial Disclosures (TCFD) and the Corporate Sustainability Reporting Directive (CSRD).

Integrating climate into your risk matrix closes a critical blind spot. It enables boards to: 

• Quantify potential supply losses and cost volatility. 

• Prioritise investments and diversification based on risk weighting. 

• Demonstrate compliance and transparency to investors. 

• Build long-term business resilience.

Climate risk is, in effect, financial risk with a time lag. The sooner it’s measured, the sooner it can be managed.  

Embedding climate risk into decision-making: A three-step framework 

At Aethr, our work with producers, importers, and retailers across the fresh food supply chain shows that climate resilience isn’t achieved through single interventions. It’s built through structured analysis, translating data into decisions. Here’s how we approach it.  

Step 1: Establish vulnerability 

Every organisation has exposure points, they could be specific regions, suppliers, or commodities that are disproportionately sensitive to climate shocks. Using climate projection data such as temperature movement, precipitation change, and water stress indices, you can identify where those vulnerabilities sit.

For example, Spain, the UK’s largest fresh produce supplier, is projected to see a 15% increase in average temperature and an 8% decline in rainfall by 2050. Mapping such trends against sourcing locations allows businesses to pinpoint high-risk zones before disruptions occur.

Vulnerability is determined by two factors: 

Vulnerability = Likelihood × Severity

The higher the likelihood and the more severe the impact, the greater the vulnerability. By plotting these across your portfolio, you can compare which suppliers or regions carry the most immediate threat to continuity.  

Step 2: Quantify financial exposure 

Once vulnerabilities are identified, the next step is to translate them into financial language. This involves asking: what would it cost us if this region, supplier, or product were disrupted?

For example, if Morocco’s key horticultural region suffers another season of severe water shortage, what is the potential cost of yield loss, freight rerouting, or supplier substitution?

Expressed as a percentage of total revenue, supplier spend, or margin, this analysis turns climate scenarios into board-ready data.

Climate Risk = Vulnerability × Financial Impact

The goal isn’t prediction – it’s prioritisation. Quantifying exposure helps businesses decide where to focus mitigation budgets for maximum effect. 

Step 3: Implement targeted mitigation 

Armed with a clear risk profile, businesses can move from reaction to prevention.  

Effective mitigation could include: 

• Diversification: Reducing reliance on high-risk regions through multi-country sourcing strategies. 

• Supplier collaboration: Supporting growers in adopting water-efficient technologies, regenerative practices, or shade-resilient crops. 

• Controlled-environment farming: Investing in hydroponics or vertical farms to stabilise domestic supply. 

• Infrastructure investment: Protecting logistics hubs, cold chains, and storage facilities from flood or heat damage.

Mitigation isn’t simply about reducing exposure, it’s about creating resilience that delivers commercial stability and consumer confidence. By embedding climate resilience into our food production, we can begin to stabilise prices and develop more robust, climate-adaptive supply chains.

The payoff: Turning risk into resilience 

Businesses that treat climate risk as a strategic variable – not a background issue – will be better positioned to adapt, attract investment, and secure long-term contracts.

Integrating climate into your risk matrix drives tangible benefits: 

• Predictability: Supply chain transparency and risk forecasting reduce unexpected costs. 

• Profitability: Early adaptation avoids expensive short-term fixes when crises hit. 

• Investor confidence: Transparent risk disclosure aligns with ESG expectations. 

• Brand trust: Demonstrating proactive action builds credibility with retailers, consumers, and regulators.

In a volatile market, resilience isn’t a cost, it’s a competitive advantage. The companies that act now will define tomorrow’s standards for sustainable sourcing and risk governance.

From data to action: Building collective resilience 

Climate change doesn’t respect supply contracts or borders. Building resilience requires collaboration – between producers, importers, retailers, and policymakers.

For UK businesses, that means: 

• Sharing climate data across the value chain. 

• Supporting overseas suppliers to invest in sustainable farming practices. 

• Embedding resilience KPIs into procurement and partnership agreements. 

• Treating adaptation as a strategic priority, not a sustainability side project.

At Aethr, we help businesses translate climate data into practical, financially sound strategies. Our climate risk evaluation and prioritisation process gives decision-makers a clear, structured view of where they’re most exposed and how to act before disruption occurs.  Because the real risk isn’t climate change itself – it’s inaction. 

Conclusion: Redrawing the risk map 

The evidence is unequivocal. Rising global temperatures, shifting rainfall patterns, and more frequent floods and droughts are destabilising key agricultural regions and threatening food security worldwide. The UK’s heavy dependence on climate-vulnerable imports means the risks are immediate and measurable.

But the opportunity is equally clear. By integrating climate risk into the business risk matrix, companies can protect supply continuity, enhance profitability, and demonstrate leadership in an uncertain world.

If climate change is reshaping your risk map, Aethr can help you redraw it – for resilience, profitability, and long-term security. 

Take the next step 

Ready to integrate climate risk into your decision-making?  

Join our free webinar on Thursday, November 6^th, 11-12 GMT: Understand, assess, and manage your organisation's climate risk. Get a practical framework, ask questions live, and learn how to start assessing your organisation's climate exposure. Register here. 

Can't make it? Download our full strategic report "Climate Change and Fresh Food Security" for detailed climate projections, vulnerability frameworks, and resilience strategies for all major UK supplier countries. Access the report.  

Contact 

Learn more about how Aethr helps businesses assess and mitigate climate risk. 📧 richard.bonn@aethr.co.uk | 🌐 www.aethr.co.uk/services