May 2025 Climate Value Exchange actionable insights brief

In May 2025, the global climate disruption challenge is intensifying. The most significant features of this critical moment are: 

1. The compounding of climate risks and impacts, adding costs and depleting resources, in all regions;
2. Political disruption of progress toward climate-resilient development;
3. The lack of institutional preparedness for a world of frequent resilience shocks and chronic dislocation;
4. Emerging opportunities to track climate-related, ocean-aligned, and biospheric impacts;
5. The role of cities and regional governments in bulking up national climate plans.

It is increasingly clear that the right to a clean, healthy environment will shape future economic and geopolitical relations. Given this, it is surprising—and will likely remain so far into the future—that so many governments are currently looking to slow down their progress toward securing the best future for their people. News reports are full of stories about an atmosphere of peer pressure, or something like peer permission—in which political leaders appear intent to seize opportunities linked to pollution, in spite of the very real, evident, and worsening costs, that will befall their countries as a result of those decisions.

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Risks and Impacts

The effects of global heating worsened in 2024, with the global average temperature breaching the danger threshold of 1.5ºC above pre-industrial levels. It now looks like even with projections for a cooler year due to background climate conditions, 2025 will be the second straight year above 1.5ºC. 

This comes with significant risk and cost: 

• Between mid-2024 and early 2025, the United States suffered two major extreme events projected to cost more than $250 billion over time. 
• Food systems are strained, and pressures on watersheds and ecosystems are making that stress worse. 
• Costs are rising due to bird flu; livestock pathogens and crop pests are proliferating, creating new risks and the possibility of a “new normal” of ongoing price shocks.
• Sea levels have risen, meaning storms don’t need to be as intense to deliver worse impacts than in the past. 
• Resilience measures are increasingly important, increasingly expensive, and need to be more multifaceted than before.

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Political Disruption 

In 2025, we have seen a surprising level of reversals in climate policy. Historically, even political “denialists” have recognized that it makes sense to invest in all available energy systems, to ensure agility and market choice, and to prioritize resilience against shocks and extreme events. 

The new U.S. administration has been aggressively moving to treat all things climate as taboo—even moving to disable the country’s world-leading scientific capabilities in an apparent effort to disrupt the public’s access to evidence about climate risk, harm, and cost. The U.S. Constitution requires Congress act to advance science and innovation, and precludes actions that reduce access to evidence or “redress”, so it is expected many of these efforts at suppression of evidence will be reversed.

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Lack of Preparedness

As climate disruption worsens, and affordable access to food, water, and livable conditions, is denied to more people, it is projected every region will see unprecedented levels of mass migration. Despite a century of successes in humanitarian aid and crisis response, no nation’s institutions are properly prepared for a world shaped by such constant shock, dislocation and disruption. 

This means that even as some governments push to curtail and reverse climate progress, the effort to develop new modes of international cooperation suited to the age of climate disruption must advance quickly. This time of setbacks and geopolitical uncertainty is the moment it falls to all of us to determine how we will emerge into a future of enhanced adaptive capacity and cooperative problem-solving, with human rights at the center of dominant institutional structures.

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Emerging Opportunities

It must be noted that, while “generative AI” systems are gaining investment for what they can fabricate, or emulate, the great future opportunity of advanced data processing lies in the ability of complex neural networks to develop increased precision measurements due to the consideration of a wide range of datasets and variables. Climate-aligned cross-referencing of complex day to day data will eventually give us actionable clarity on the climate intelligence of any given industrial process or investment decision.

No commercial entity should expect that every government, every insurer, every bank or investment manager, will uniformly endorse activities that are depleting their overall opportunity or eroding their net financial holdings. Climate intelligence data will eventually make sustainable investing the biggest opportunity for new investment in all sectors, in all regions. The key question this year is how much progress will be made in developing the business models that leverage such insights to outcompete conventional market wisdom.

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The Role of Local Government

Earlier this year, we announced the City Food Finance Principles to Build Climate Value. Cities anchor regional economies, conditioning opportunities for new investment across the full spectrum of everyday activities. Food systems touch every aspect of local economic reality, and condition people’s access to health, wellbeing, and sustainable human development. 

Through the Climate Action and Food Systems Alliance and the Climate Value Exchange, we will look to explore how these principles support mainstreaming of climate progress in food systems and in other sectors as well: 

1. Common Reality – Health-building, nutritious, sustainably produced food should be an affordable, accessible everyday option for all.
2. Delivering Impact – Cities deliberately play the role of impact investor, to shape healthy, sustainable food environments.
3. Urban-Rural Feedbacks – Cities work with surrounding rural areas to support convergence of consumption, production, and incentives.
4. Multilevel Cooperation – Cities engage with regional and national authorities to support enhanced implementation of national climate, food, health, and biodiversity plans.
5. Co-Investment – Cities engage proactively to shape and mobilize investment partnerships linked to a broader Co-Investment Platform for Food Systems Transformation.
6. Tracking and Labeling – Cities act as critical intermediaries to support needed data systems integration and multidimensional metrics.

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The key Climate Value insight we wish to advance in May 2025 is that—in spite of the political and economic challenges of this moment—now is the time to start making the optimal decisions about how to achieve a climate-resilient future. Assessing risks with high-quality, interactive, open and accessible data, enhancing resilience measures and adaptive capacity, building Earth systems insights into financial decisions, are all critical tools for securing a livable future, for communities, industries, countries, and for the global community of nations.

We now look forward to examining these questions in light of the next round of international climate negotiations, in the SB62 Cycle of Earth Diplomacy Leadership workshops, starting on June 2.