How Do Climate-related Conditions Affect Norwegian Enterprises?

Climate related conditions, such as changing customer preferences, stricter climate policy and altered weather patterns, are having “important” effects on most Norwegian businesses, according to research produced by Norges Bank.

The report presents findings from three annual surveys of Norwegian businesses showing that 90% of enterprises report that climate conditions are affecting their operations, and over 40% state that they result in rising prices and costs.

The companies surveyed by the central bank regard changes in customer preference as the most influential overall climate related factor.

Almost half of the organisations also see their operations affected by “changes in bank lending conditions”, with the oil sector reporting the highest level of vulnerability in this area. Petroleum suppliers also showed the highest sensitivity to changing customer preferences.

Despite an expectation of rising costs, the majority of businesses also said they expect that the structural changes required by the low-carbon transition will present new opportunities in business, investment and technology.

A large proportion of companies report that changing climate conditions are driving increased competitiveness, growing expertise, product development, new markets and changes to product composition.

One example of the positive impact of transition is in the building sector, which experienced high increases in demand for their services and expected increases in employment as a result of changing climate conditions.

However, along with the public sector, the construction industry also reported the most significant impact of changing weather norms, highlighting the importance of tackling physical risk to take advantage of transition opportunities.