“We are the first generation to feel the impact of climate change and the last generation that can do something about it.” – Barack Obama
For Caribbean economies, this truth hits harder than most. Rising sea levels, stronger hurricanes, and unpredictable weather patterns have turned climate change from an environmental issue into a financial one. Businesses and financial institutions are now recognizing that climate risk accounting is not simply about compliance—it’s about survival, resilience, and long-term sustainability.
Over the last decade, climate risk accounting has shifted from being a niche concern to a core financial reporting issue. A decade ago, annual reports might have briefly mentioned environmental risks. Today, investors, regulators, and global standards bodies expect measurable disclosures that demonstrate how climate risks affect profitability, asset values, and business continuity. In the Caribbean, where economies are heavily reliant on tourism, agriculture, and coastal infrastructure, the stakes could not be higher.
Regionally, the Caribbean Development Bank (CDB), CARICOM, and the Caribbean Centre for Renewable Energy and Energy Efficiency (CCREEE) are driving initiatives to strengthen climate resilience and encourage businesses to align with these global sustainability standards. This momentum highlights that climate risk disclosures are no longer optional—they are critical for accessing international finance, investment, and insurance markets.
These efforts are part of a wider global movement. Under the United Nations’ Sustainable Development Goals (SDGs) – particularly Goal 13 on Climate Action – countries and businesses are expected to integrate climate-related risk into their planning and reporting. Increasingly, financial markets are tying capital access to sustainability performance, which means that climate risk accounting is becoming a cornerstone of responsible global business practice.
Looking ahead, climate risk accounting will become increasingly data-driven and standardized. Over the next 10 to 20 years, we are likely to see scenario modeling, advanced risk analytics, and AI-driven forecasting become embedded in financial systems. For Caribbean businesses, this means accounting not only for physical risks such as hurricane damage, but also transition risks tied to shifts in trade, energy, and regulation.
The time to act is now. Integrating climate risk into financial reporting is not just a compliance exercise, it is a strategy for resilience, competitiveness, and sustainable growth. The Caribbean businesses that embrace it early will not only withstand the storms but lead the way in shaping a more secure economic future.
