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Private sector investments in climate change adaptation

Nature Climate Change (2025)Cite this article

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Abstract

Amid escalating climate impacts, understanding private sector adaptation is critical. Here using data of actual adaptation expenditures from nearly 300,000 businesses in five coastal regions, we reveal variations in private sector adaptation across sectors and regions. The agriculture sector leads in adaptation efforts, while transport, construction and utilities—that is potential sources of system-wide cascading effects—lag. Small, medium and large businesses prioritize hard and soft measures, barely investing in ecosystem-based adaptations. Adding to the multifaceted discourse on adaptation effectiveness, our panel data reveal positive, although inelastic in the short run, relationships between private sector adaptations and aggregate regional economic performance. Business adaptations in the construction, transport and health sectors associate positively with regional economic performance, with the accommodation and food services sector yielding the highest return per euro invested in adaptation. Combining these findings with existing assessments of adaptation could support the development of societally effective adaptation strategies.

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Fig. 1: Coastal regions included in our adaptation investment dataset.
Fig. 2: Types of private sector adaptations and their relative shares across five coastal regions.
Fig. 3: Differences in adaptation investment shares by economic sector across five coastal regions.
Fig. 4: Patterns of private sector adaptations by measure type across five regions and seven economic sectors.
Fig. 5: Effects of private sector adaptation investments on regional economic performance differentiated by sector and region.

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Data availability

The data on private sector adaptation investments that support the findings of this study are available from kMatrix Data Services. Restrictions apply to the availability of these data, which were used under license for the current study and are not publicly shareable. Any queries regarding the raw data should be directed to kMatrix Data Services (enquiries@kmatrix.org). Source data are provided with this paper.

Code availability

The Python code used to produce the display items and the STATA code used for the regression are available via Zenodo at https://doi.org/10.5281/zenodo.16602772 (ref. 51).

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Acknowledgements

This work was supported by the European Research Council under the European Union’s Horizon 2020 Research and Innovation Program (grant agreement no. 758014). We thank kMatrix, specifically Sarah and Steve Howard, for their continuous support with the database development and administration.

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Author notes

  1. Alessandro Taberna

    Present address: CMCC Foundation - Euro-Mediterranean Center on Climate Change, RFF-CMCC European Institute on Economics and the Environment, Milano, Italy

Authors and Affiliations

  1. Department of Multi-Actor Systems, Faculty of Technology, Policy and Management, Delft University of Technology, Delft, the Netherlands

    Tatiana Filatova, Alessandro Taberna, Theodoros Chatzivasileiadis & Ignasi Cortés Arbués

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  1. Tatiana Filatova
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  2. Alessandro Taberna
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Contributions

T.F. designed the overall research project, conceived the research design and wrote the paper. A.T. conducted the descriptive analysis, produced the display items and wrote the paper. T.C. developed the regression model, conducted the sensitivity analysis, produced the display items and contributed to and commented on the paper. I.C.A. supported the data analysis, helped with the dataset description and contributed to and commented on the paper.

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Correspondence to Tatiana Filatova.

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Nature Climate Change thanks Sam Barrett, Kate Gannon and Thomas Neise for their contribution to the peer review of this work.

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Supplementary Information

Supplementary Appendices A, B and C, with Tables 1–7 and Figs. 1–4.

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Filatova, T., Taberna, A., Chatzivasileiadis, T. et al. Private sector investments in climate change adaptation. Nat. Clim. Chang. (2025). https://doi.org/10.1038/s41558-025-02423-w

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