How has climate-related scenario analysis, including multiple scenarios, been used to identify and assess physical and transition risks and opportunities over short, medium, and long-term horizons?

1. Use of Climate-Related Scenario Analysis Climate Scenario Analysis is used to explore potential climate-related risks and opportunities by considering a range of possible future climate outcomes. The company should describe how it has used climate scenario analysis to identify and assess both physical risks (e.g., extreme weather events, rising sea levels) and transition risks (e.g., regulatory changes, market shifts) under various scenarios. 2. Range of Climate Scenarios The company should explain the scenarios used in the analysis, which may include: 1.5°C scenario (aligned with Paris Agreement goals). 2°C or higher scenarios (considering possible overshoot). Business-as-usual scenarios (no significant climate action). Describe how these scenarios help evaluate short-term (1-5 years), medium-term (5-10 years), and long-term (10+ years) risks and opportunities. 3. Assessment of Physical Risks and Transition Risks and Opportunities Physical Risks: Explain how the analysis of physical hazards (e.g., floods, heatwaves) varies under different climate scenarios and impacts the company’s assets, supply chains, and operations over time. Transition Risks and Opportunities: Describe how transition risks (e.g., new regulations, technological shifts) and opportunities (e.g., growth in low-carbon products) are assessed across the scenarios. Include the potential impact of carbon pricing, regulatory requirements, and market demand for sustainable products. 4. Integration with Business Strategy The company should outline how scenario analysis results inform strategic decisions and business planning, such as: Investments in climate-resilient infrastructure. Adaptation strategies to reduce physical and transition risks. Development of sustainable products or green technologies. https://xbrl.efrag.org/e-esrs/esrs-set1-2023.html#903