The impact of extreme climate events on financial performance : evidence from manufacturing firms in Europe

Climate change is one of the most significant challenges of our time, with profound implications for global economies, societies, and ecosystems worldwide. The scientific community is clear: human activities, particularly the burning of fossil fuels, deforestation, and industrial processes, have drastically increased greenhouse gas (GHG) emissions, driving global temperatures higher and altering climate patterns. The Intergovernmental Panel on Climate Change (IPCC) warns that without urgent and coordinated action, that global warming is expected to surpass 1.5°C over pre industrial levels by 2030, resulting in disastrous consequences for natural and human systems. The impacts of climate change are already evident worldwide, materializing as increasingly frequent and severe extreme weather phenomena such as heatwaves, floods, and storms. The impacts of climate change are already being felt, manifesting in more frequent and intense extreme weather events such as heatwaves, floods, and storms. These events pose substantial risks to various industries, particularly the manufacturing sector in Europe, which faces vulnerabilities in supply chains, energy availability, and production stability. This paper examines the impact of extreme climate events on the financial performance of private manufacturing firms in Europe. Using a regression model, it analyzes how different climate variables have affected the financial health and performance of European companies over the past decade (2013–2023), offering insights into the challenges posed by climate-related disruptions. ; A mudança climática é um dos desafios mais significativos do nosso tempo, com implicações profundas para as economias globais, sociedades e ecossistemas em todo o mundo. A comunidade científica é clara: as atividades humanas, particularmente a queima de combustíveis fósseis, o desmatamento e os processos industriais, aumentaram drasticamente as emissões de gases de efeito estufa (GEE), elevando as temperaturas globais e alterando os padrões climáticos. ...