Asia-Pacific companies are experiencing substantial financial returns by addressing climate risks, according to the latest report from CDP. The Disclosure Dividend 2026 report highlights that businesses in the region are seeing a median return of $7 for every $1 invested in environmental risk management. This return is notably higher in South Korea, China, and Japan, with returns of $24, $11, and $9 respectively.
The report underscores the financial exposure of companies to transition risks, with $732b of revenue at stake. Transition risks, which arise during the shift to a net-zero economy, affect 11% of revenue across the region. Notably, China and Southeast Asia report 9% of revenue at risk, whilst Japan faces an 11% exposure.
Investments in emissions reduction are proving to be financially prudent, with a median payback period of 2.8 years for APAC companies. This is quicker than the median payback periods in Europe and the US, which stand at 3.7 and 3.0 years respectively. China leads the region with the fastest returns, achieving a median payback period of just 1.9 years.
The report also finds that companies engaging in environmental disclosure face approximately one-third less transition-related risk compared to those not disclosing. This suggests that transparency in environmental practices not only aids compliance but also mitigates financial risks.
The findings from CDP’s report highlight the tangible financial benefits for companies proactively managing climate risks, positioning them advantageously in the evolving global economy.
