London-based Schroders has collaborated with the Global Labor Institute at Cornell University to launch a new toolkit to guide investors in engaging with companies on the social implications of climate-related physical risks.

The initiative, centered on “just resilience,” aims to integrate climate adaptation with social justice, ensuring vulnerable workers in global supply chains are not disproportionately impacted by worsening climate events.

The investor toolkit provides a framework for understanding how climate hazards such as extreme heat, droughts and flooding threaten portfolio performance and human rights, particularly in sectors and geographies highly exposed to environmental disruptions.

“Climate change isn’t just an environmental issue—it’s a deeply human one,” Schroders and the GLI said in a joint statement. “Just resilience is about ensuring that adaptation strategies protect not only physical assets, but also the people behind the supply chains.”

The toolkit highlights how globalization has increased corporate dependency on international value chains, many of which are already experiencing disruptions due to extreme weather events.

According to data cited in the report, even with current emissions trends, these climate impacts could reduce global income by up to 19 percent by 2049.

Industries and Workers on the Front Line

Industries reliant on natural resources — such as mining, energy and agriculture — face particularly high risks, while the apparel sector remains vulnerable due to its footprint in climate-sensitive regions.

The report points to potential earnings losses and job cuts in garment-producing countries like Bangladesh, Cambodia and Vietnam if no adaptation measures are taken.

To guide investor engagement, the document proposes a series of questions covering risk identification and adaptive actions, such as:

  • How do companies assess physical climate risks within their supply chains?
  • Are workers being supported to cope with extreme heat or flooding?
  • Do brands financially assist suppliers in implementing adaptation measures?

Examples from companies such as Nike, Inditex, and Tapestry were highlighted as early adopters of risk assessment and worker-focused adaptation.

Nike, for instance, has included climate-related heat stress protections in its supplier code of conduct.

A Call for Collaborative, Human-Centric Action

The report also warns against a “cut and run” strategy — relocating production to less affected regions — arguing this approach may undermine supplier relationships and shift rather than solve climate risks.

Instead, it urges brands to support existing suppliers with technical assistance, improved working conditions, and better insurance access.

Schroders’ toolkit comes amid growing pressure on investors to consider financial returns and the environmental and social consequences of their portfolios.

The initiative seeks to build a shared understanding of responsible adaptation to climate change in practice.

“Ultimately, resilience should be inclusive and equitable,” the toolkit concludes. “Investors have a crucial role to play in shaping how companies respond.”

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