New York, September 25, 2025 – As world leaders gather for Climate Week NYC, new research from Clarity AI, the leading global sustainability technology company, reveals that most large companies are failing to properly assess the financial risks they face from climate change. While 77% report conducting some form of climate scenario analysis, only 30% produce comprehensive disclosures. This leaves businesses, consumers, and investors exposed to significant blind spots at a time when extreme weather events, supply chain disruptions, and climate-driven shocks are intensifying worldwide.
The study analyzed disclosures from nearly 1,900 companies in the MSCI ACWI Index to evaluate whether they conducted robust climate scenario analysis. Using Large Language Models (LLMs), Clarity AI assessed each company against six best-practice criteria drawn from leading frameworks (e.g., TCFD, ESRS, EFRAG): testing high-warming scenarios; relying on authoritative sources such as the IPCC or IEA; considering both acute and chronic hazards; applying longer-term horizons; disclosing results; and extending coverage beyond operations to include suppliers/customers.
Regional leaders and laggards
Results show a stark divide across regions. Europe leads the way, with half (50%) of companies meeting all criteria, which could be linked to the introduction of stronger disclosure requirements such as the EU’s Corporate Sustainability Reporting Directive (CSRD). Japan also performs strongly (51%), likely reflecting years of momentum around TCFD-aligned disclosure. By contrast, only 10% of North American companies meet all criteria, which may reflect fewer mandatory disclosure rules in the US.
Sector blind spots
Performance also varied widely across sectors. Even among the strongest industries, such as transportation, banking, real estate, and consumer durables, fewer than 40% of companies met all six criteria. At the other end of the spectrum, healthcare, energy, consumer staples, and non-bank financial services lagged furthest behind, with fewer than one in four companies achieving comprehensive disclosure.
In the semiconductor industry, where production relies heavily on freshwater and is therefore highly exposed to climate-related water risks, nearly a third of firms (31%) provided no evidence of scenario analysis—a striking blind spot in such a strategically critical sector.
Supply chain risks overlooked
Another key weakness was the evaluation of supply chains. Even in Europe, where disclosure practices are most advanced, nearly a third of companies still failed to explicitly assess supplier exposure. This suggests that value chain vulnerabilities remain under-evaluated worldwide, leaving both companies and investors unprepared for potential disruption.
“Our findings show that while more companies are starting to acknowledge climate risks, most still fall short of assessing them in a credible way,” said Nico Fettes, Climate Research Director at Clarity AI. “Without high-quality assessments using scenarios, businesses risk financial losses and operational disruptions, while investors risk mispricing vulnerabilities and being blindsided by climate shocks. These risks are not abstract—they are happening now. Stronger disclosure of scenario analysis is essential to build resilience across companies, markets, and the wider economy.”
For more information on Clarity AI and to access the full research, please visit: https://clarity.ai
About Clarity AI
Clarity AI is the leading sustainability tech company, leveraging advanced technology and AI to provide data-driven environmental and social insights to investors, corporates, governments, and consumers. AI has been at the core of Clarity AI’s offering from the start, supporting a fully flexible set of data solutions, insights, analytics capabilities, and tools used for portfolio management, corporate research and engagement, benchmarking, regulatory reporting, online banking, and e-commerce.
Within the investment sector, Clarity AI serves a direct network of clients managing around $70 trillion in assets and includes firms like Nordea, Crédit Agricole, PGIM, or Santander. Our strategic partnerships with financial institutions such as BlackRock, BNP Paribas, Caceis, or SimCorp, allow thousands of users to access Clarity AI advanced data analytics capabilities through their usual investment platforms, ensuring a seamless workflow experience. Clarity AI has offices in Europe, North America, and the Middle East. For more information visit www.clarity.ai
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