Capgemini’s A World in Balance 2026 Highlights Sustainability as Resilience Strategy
Climate risk is no longer just a reporting obligation for UK businesses. According to new research published in September 2026, companies are treating climate adaptation, water scarcity, and resource constraints as core business resilience issues. This shift has direct consequences for how SMEs approach supply chain management, capital allocation, and operational planning.
The findings come from the fifth edition of A World in Balance, a research series tracking corporate sustainability strategy. The 2026 report draws on responses from 2,100 senior executives across 701 organisations in 13 countries, alongside input from 6,500 consumers. What emerges is a picture of businesses under pressure from multiple directions: physical climate impacts, resource shortages, regulatory demands, and the growing environmental footprint of AI.
For UK SMEs, the implications are practical. Businesses competing for public sector contracts already know that carbon reporting and net zero credentials influence procurement decisions. However, the latest data suggests the challenge is widening. Companies must now demonstrate not only emission reduction plans but also credible strategies for managing physical climate risk, securing critical resources, and governing emerging technologies.
This article examines what the research reveals, what it means for smaller businesses in the UK, and where the gaps between corporate ambition and delivery remain most visible.
Climate adaptation spending rises as supply chains face repeated disruption
The proportion of executives who say their organisations actively prioritise climate adaptation has increased from 56% in 2025 to 68% in 2026. Meanwhile, 83% expect to raise climate adaptation spending over the next 12 to 18 months. These figures reflect a shift in how businesses allocate resources. Adaptation is no longer a secondary consideration after mitigation. It is being funded as a resilience measure.
Nearly nine in ten organisations report that climate-related events have disrupted their supply chains. For UK manufacturers, logistics providers, and importers, this statistic will feel familiar. Extreme weather has delayed shipments, damaged infrastructure, and increased costs. Consequently, businesses are spending more to protect operations from future shocks.
Water scarcity is emerging as a specific concern. Notably, 61% of executives expect water constraints to pose a greater risk to business growth than energy availability over the next five years. This marks a significant change in how resource risk is prioritised. Energy transition has dominated the sustainability agenda for the past decade. Water is now being recognised as equally critical, particularly for sectors reliant on manufacturing, agriculture, or cooling systems.
The focus on adaptation does not mean mitigation is being abandoned. However, it does suggest that businesses are recalibrating their spending. Investments in flood defences, water efficiency, supply chain diversification, and climate-resilient infrastructure are competing for budget alongside carbon reduction projects.
Net zero targets slip as measurement gaps persist
The research reveals a widening gap between corporate net zero commitments and actual delivery. While 84% of organisations say they have set science-based targets, only 42% report being on track to meet their 2030 or interim goals. Furthermore, 29% have postponed net zero objectives, compared with just 8% in 2025.
This trend has direct implications for UK SMEs. Many smaller businesses have committed to net zero in response to customer expectations, supply chain requirements, or tender criteria. Missing those targets creates reputational risk and may affect future contract eligibility. Additionally, the postponement of deadlines by larger organisations could create uncertainty in supply chains, particularly where scope 3 emissions reporting depends on supplier data.
Measurement remains a persistent challenge. Only 15% of organisations have fully quantified the financial impact of climate-related risks. This means the majority of businesses cannot yet translate climate exposure into balance sheet terms. For SMEs, this creates a practical problem. Without clear financial metrics, it becomes harder to justify climate spending to investors, lenders, or boards.
The research also tracks a sustainability maturity index, which has declined for the second consecutive year. The index fell from 111 in 2025 to 105 in 2026. This decline suggests that despite increased awareness and investment, many organisations are struggling to embed sustainability into core operations.
Nevertheless, there is evidence of positive returns. Almost seven in ten organisations, or 69%, report a positive return on investment from sustainability initiatives. This figure is up from 49% in 2025. The increase suggests that businesses are beginning to realise financial benefits from efficiency gains, waste reduction, and improved brand perception. For SMEs, this data offers some reassurance that sustainability spending can deliver measurable value.
AI enters the sustainability agenda as both tool and governance challenge
Artificial intelligence is now embedded in corporate sustainability strategies. Nearly two-thirds of organisations use AI to support their sustainability goals, and more than one-third use or plan to use agentic AI for sustainability initiatives. These systems are being deployed to optimise energy consumption, monitor emissions, model climate risk, and manage supply chain data.
At the same time, AI introduces new environmental and governance questions. Seven in ten organisations report that AI's sustainability implications are discussed at board level. This reflects growing awareness that AI systems consume significant energy and require careful oversight. Consequently, businesses must now account for the environmental footprint of the technology they use to manage their environmental performance.
For UK SMEs, AI presents both opportunity and complexity. Smaller businesses may lack the resources to deploy sophisticated AI tools internally. However, many will encounter AI through software platforms, supply chain management systems, or customer portals. Understanding how these systems affect energy use, data privacy, and sustainability reporting will become increasingly important.
The research suggests that AI is being treated as a dual challenge: a source of efficiency gains and a new category of environmental risk. Businesses are being pushed to evaluate not only what AI can do for sustainability, but also what sustainability governance AI itself requires.
What the research tells us about corporate priorities in 2026
The findings highlight several important shifts in how businesses approach sustainability. First, adaptation is receiving comparable attention to mitigation. Second, resource security, particularly water, is moving up the risk register. Third, AI is now a standard part of the sustainability conversation. Fourth, delivery is lagging behind ambition, particularly on net zero timelines and financial measurement.
These trends matter because they shape the environment in which UK SMEs operate. Larger organisations set expectations for their supply chains. If those organisations are prioritising adaptation, resource efficiency, and AI governance, suppliers will be asked to demonstrate capability in those areas. Similarly, if net zero deadlines are being postponed, smaller businesses may face pressure to adjust their own timelines or risk being out of step with partners.
The data also reveals where businesses are succeeding. More organisations are reporting positive returns from sustainability spending. This suggests that the business case for sustainability is strengthening, even if execution remains uneven. For SMEs, this finding is relevant when making the case for investment internally or to external stakeholders.
Key points from the 2026 findings
- 68% of executives say their organisations actively prioritise climate adaptation, up from 56% in 2025.
- 83% expect to increase climate adaptation spending over the next 12 to 18 months.
- Nearly nine in ten organisations report climate-related disruption to supply chains.
- 61% expect water scarcity to constrain business growth more than energy availability over the next five years.
- Only 42% of organisations with science-based targets are on track to meet 2030 goals.
- 29% have postponed net zero objectives, compared with 8% in 2025.
- Just 15% have fully quantified the financial impact of climate-related risks.
- 69% report a positive return on investment from sustainability initiatives, up from 49% in 2025.
How UK SMEs should interpret the trend towards resilience-led sustainability
The shift from compliance-led sustainability to resilience-led sustainability has practical consequences for smaller businesses. Resilience frameworks are broader than carbon accounting. They require businesses to assess physical risk, supply chain vulnerability, resource dependency, and governance gaps. For many SMEs, this represents a step change in how sustainability is understood and managed.
Businesses should start by identifying where climate and resource risks intersect with their operations. For example, a manufacturer reliant on water-intensive processes needs to assess local water availability and pricing trends. A distributor with a geographically concentrated supply chain should evaluate exposure to extreme weather. A professional services firm using cloud-based AI tools should understand the energy consumption of those platforms.
Measurement remains essential. The research shows that most organisations still cannot quantify climate risk financially. SMEs that develop this capability early will be better positioned to manage risk, access finance, and respond to due diligence requests. Tools exist to support this work, including scenario analysis frameworks, carbon accounting software, and ESG compliance services tailored to smaller businesses.
Supply chain alignment is another priority. If your customers or partners are increasing their focus on adaptation, resource security, or AI governance, you will need to demonstrate progress in those areas. This may involve updating sustainability disclosures, participating in supplier assessments, or investing in new data systems. Our net zero program for carbon reporting compliance is designed to help businesses meet these evolving expectations.
Finally, businesses should recognise that sustainability is increasingly tied to commercial performance. The research shows that more organisations are seeing positive returns from sustainability investment. This trend reflects growing customer demand, regulatory pressure, and cost savings from efficiency improvements. SMEs that treat sustainability as a source of competitive advantage, rather than a compliance burden, are more likely to benefit from this shift.
Where to find further guidance on climate adaptation and business resilience
Businesses looking for additional information on climate adaptation, resource risk, and net zero delivery can access resources from several authoritative sources. The Department for Energy Security and Net Zero publishes guidance on climate risk assessment and adaptation planning. The UK Climate Change Risk Assessment provides detailed analysis of physical climate risks facing the UK economy.
For sector-specific advice, the Institute of Environmental Management and Assessment offers professional standards and training on environmental risk and sustainability governance. Businesses working on supply chain resilience and sustainable procurement can find practical tools through the Chartered Institute of Procurement and Supply.
The government's guidance on measuring and reporting environmental impacts remains the definitive reference for UK businesses preparing for mandatory climate disclosures. For training on emissions measurement and Scope 3 reporting, the SBS Academy provides courses tailored to the needs of smaller organisations.