Climate Scenario Analysis Comparison

Scenario analysis tested resilience of decarbonisation strategy across four climate warming and transition trajectories. Transition risks analysed over short-term (0-3 years), mid-term (3-10 years), and long-term (10-30 years) horizons. Physical risks analysed to 2100 for Aotearoa NZ and Pacific Islands (rest of network to be analysed in 2024). Analysis revealed interconnected nature of risks and identified areas requiring further analysis. Scenarios incorporate global climate/socioeconomic pathways, global energy pathways (electricity, hydrogen, SAF), Aotearoa NZ-specific impacts, and aviation-specific developments.

Orderly scenario: Stable conditions, increased demand for climate-resilient seedlings, access to green financing. Too Little Too Late: Moderate-to-high physical impacts, supply chain disruptions, increased demand for carbon sequestration. Hot House World: Frequent extreme weather, severe supply chain disruptions, labour shortages in Brazil, but increased demand for resilient genetics and building materials. Scenario analysis conducted in FY24 using workshops with management and external consultants (WSP NZ); no quantitative financial modelling performed. Company considers scenarios appropriate and continues to use them.

Orderly scenario: Medium transition risk, low physical risk. Too Little Too Late scenario: High transition risk, medium physical risk. Hot House World scenario: Low transition risk, high physical risk. Portfolio TVaR remains constant at 2% of portfolio value (2050 scenario) compared to base year. Portfolio VaR remains at 0.2% of portfolio value (2050 scenario), indicating no additional potential loss year-on-year. Transition risks and opportunities assessed across all material investments using FSC Climate Scenario Narratives aligned with NGFS scenarios.

Orderly 1.5C scenario: Coordinated global action, progressive policy, rapid technology uptake, transition risks initially increase short-medium term then reduce. Too Little Too Late >2C: Misaligned delayed transition, varied societal pressure, moderate carbon pricing, delayed technology development, transition risk increases rapidly short-term then plateaus, physical risk climbs steadily. Hothouse >3C: Minimal action, limited social pressure, policy reversal, limited technological change, limited transition risk but significant acute/chronic physical risks materialize, exponential financial impacts long-term. Booster considers scenarios sufficient for investment management purposes despite some inputs now outdated.

Physical risk assessment using >3.0°C Hot House scenario shows overall portfolio risk rating as Low Risk across all geohazards (flooding, coastal inundation, coastal erosion, landslides, sea level rise). Transitional risks vary by scenario: 1.5°C Orderly assumes immediate ambitious policies with enabling regulations and reduced implementation costs; 2.0°C Disorderly assumes delayed policy response post-2030 with rapid catch-up and supply chain disruptions; >3.0°C Hot House assumes no further decarbonisation policies with extreme physical risks and limited transition risks. Climate variables (temperature, rainfall, wind) assessed across medium-term horizon.

Green Light: Orderly transition with rapid renewable fuel technology adoption from mid-2030s. SAF replaces jet fuel, green hydrogen replaces diesel for heavy transport. EV adoption accelerates by 2035. NZ population 6.04M by 2050. Sea level rise 0.22m by 2050. Carbon price $277/tonne by 2050. Channel achieves Net Zero Scope 1&2 by 2030. Amber Light: Delayed, inconsistent global decarbonization. SAF not available in significant quantities until after 2040. Green hydrogen delayed. Fossil fuel demand continues rising before declining from 2030. NZ population 5.94M by 2050. Sea level rise 0.24m by 2050. Carbon price $369/tonne by 2050. Channel achieves Net Zero by 2035. Red Light: No decarbonization, emissions grow. Renewable fuel technology advances limited. Conventional jet fuel continues. Diesel for heavy transport. NZ population 6.94M by 2050. Sea level rise 0.28m by 2050. Carbon price $35/tonne by 2050. Channel continues storing conventional fuels. Across all scenarios, Channel has opportunity to grow and diversify while supporting decarbonization. Jet fuel demand remains stable/grows due to NZ's remote location and tourism/export reliance.

Aon 2022 climate change risk assessment evaluated coastal, pluvial, and fluvial flooding impacts on Chorus network assets across two timeframes. Results showed potential exposure across multiple asset types (key exchange sites, other exchange/access sites, underground utility boxes, terminal enclosures/cabinets, poles, regional fibre). Cyclone Gabrielle in Feb 2023 validated findings with damage consistent with report predictions, though no damage to primary exchanges or access sites. About 55,000 consumers unable to access services for a period due to power network damage and some regional fibre route cuts.

Orderly scenario: About half of North Island expected to decrease in suitability for Sauvignon Blanc, but remainder of North Island and bulk of South Island expected to have small to moderate gains. Marlborough expected to increase slightly. Disorderly scenario: Some current Sauvignon Blanc vineyards in Gisborne and Hawke's Bay negatively impacted; Marlborough increases slightly; 17 additional hot days per year mid-century in Hawke's Bay, 33 by end of century. Hothouse scenario: By end of century, most North Island expected to have substantial losses in suitability; South Island gains, with Canterbury and Otago overtaking Marlborough. For Barossa Valley: Orderly scenario shows 25-85% increase in days over 35°C by 2090, 15% rainfall reduction by 2050. Disorderly scenario: 7.4-15% rainfall decline by 2050, 23% increase in irrigation water demand, 50% more hot days by mid-century. Hothouse scenario: Irrigation water demand not met in 55% of years by 2050s, 60% time in drought by 2090, greater bushfire risk.

Scenario analysis performed by Deloitte (2018-2024) informed quantum and timeframe of risks. Physical risks analysed over 2030, 2050, 2070 horizons; transition risks over 2030, 2040, 2050 horizons. Analysis considered Downer's entire value chain. Transition risk analysis focused on Transport and Utilities business units and fleet supply chain. Physical risk analysis considered direct operations and downstream customers. Scenarios stress-tested strategy against significant physical and transition risks. No assessment of likelihood of scenarios was made.

RCP 2.6 (best case): Supply chain and operational disruptions from climate hazards, trend towards localisation and smooth adoption of low-carbon technologies, strong mitigation policies. RCP 4.5 (intermediate): Most significant transition impacts with delayed, rapid, disorderly, and costly transition; slow initial response followed by severe climate mandates; slower green technology development at higher cost. RCP 8.5 (worst case): More frequent and severe physical impacts increasing over time; mixed transition impacts with rising healthcare demand; uncoordinated reactive climate adaptation; energy-intensive fossil fuel-dependent growth. Physical hazards identified for Australia include heatwaves, temperature rise, bushfires, drought, extreme precipitation, wind, and coastal flooding. New Zealand identified with extreme rainfall intensity and coastal flood risk.

Scenario analysis conducted in FY24 with PwC NZ, reviewed and confirmed relevant for FY25. Three scenarios span range of warming trajectories and test resilience of EROAD's business model. Coordinated Decarbonisation presents moderate transition risks but lowest physical risks; A World Divided presents highest transition risks and moderate physical risks; Hot House presents lowest transition risks but highest physical risks. No new scenario analysis required for FY25 as previous scenarios remain current. Sector-level scenarios reviewed for transport and telecommunications; no material new issues identified.

Physical risk assessment shows moderate overall exposure with flooding as key hazard. Flood exposure (current day) is relatively modest with 69 sites showing high/very high exposure. Increases in risk due to climate change are modest, with only 12 NZ sites showing risk grading increase under RCP 8.5 scenario. Annualised flood loss ~$11m/year, increasing ~5% by 2100 under SSP1/SSP2 and ~12% under SSP3. Transition risks are assessed as more significant than physical risks, with 80% of business activities vulnerable to at least one material transition risk. All business activities can take advantage of transition opportunities.

Scenario analysis used to identify range of possible climate-related risks and opportunities over short, medium and long term to test resilience of corporate and business strategies. Scenarios adopted from Aotearoa Circle Agriculture Sector Climate Change Scenarios and Adaptation Roadmap for consistency and comparability with agriculture sector. Orderly scenario shows relatively subdued physical and transition risks; Disorderly scenario shows highly disruptive transition; Hothouse scenario shows severe physical impacts with focus on adaptation.

Fonterra acknowledges that New Zealand's emissions profile is unique with ~50% from agriculture. The company supports a 1.5°C pathway and the Zero-Carbon Amendment Bill. It notes that New Zealand's climate-efficient dairy production and regions less severely impacted by climate change present opportunities. However, achieving proposed methane targets (24-47% reduction by 2050) requires breakthrough technologies not yet commercially viable. Fonterra's on-farm emissions intensity has improved ~15% since 2008 but remains sensitive to production volumes and feed inputs. Manufacturing emissions have reduced 1.4% toward a 30% target by 2030.

Fonterra committed to Paris Agreement targets (below 2°C, pursue 1.5°C). Science-based target approved by SBTi for manufacturing emissions (30% reduction by 2030 from FY15 baseline). On-farm emissions: NZ Biological Emissions Reference Group identified potential 10-21% reduction by 2030 and 22-48% by 2050 relative to baseline, but requires comprehensive breakthrough mitigations not yet technically/commercially viable. Current trajectory shows 5.7% manufacturing reduction (FY20) and 6.2% on-farm reduction (NZ, since 14/15), indicating progress but acceleration needed.

Fully Charged scenario: Immediate and smooth global policy, fastest technology change, lowest physical impacts but moderate transition impacts greatest in short-term. Slow Followers scenario: Delayed and fragmented policy, moderate technology change, highest transition impacts greatest in medium-term, Australia moves ahead initially then NZ catches up. Route to Overshoot scenario: Insufficient global policy, slowest technology change, highest physical impacts with climate tipping points breached, lowest transition impacts but steadily increasing. Scenarios tailored to Freightways' operations and differ from Transport Sector Scenarios reference scenario to promote differentiation.

Physical risks assessed as low for 97% of Core Portfolio under all scenarios. Transition risks (market, regulatory, reputation) identified as most material, particularly around customer preferences for sustainable space, stranded assets, cost of capital, and construction sector decarbonisation. Orderly scenario presents near-term transition risks (short/medium-term); Disorderly scenario presents medium-term risks; Hot House World presents long-term physical and transition risks. Early movers in sustainable development and energy efficiency gain competitive advantage in Disorderly scenario.

Net Zero 2050 scenario: Swift transition driven by consumer preferences for eco-friendly products; companies adapting quickly gain competitive edge; new business models (rentals, sharing) grow; natural fibres resurge; supply challenges as retailers align with decarbonizing suppliers; governments implement strict climate policies. Delayed Transition scenario: Early climate action sidelined by economic pressures; inconsistent policies; companies struggle to balance decarbonisation with consumer cost concerns; delayed investments in circularity; by late 2020s/early 2030s, severe physical impacts shift sentiment toward rapid decarbonisation; governments enact stringent measures; spike in demand for decarbonisation tech creates fierce competition; by 2050, retail aligns with low-carbon economy but delayed start results in higher costs and missed opportunities for local firms. Current Policies scenario: No new climate policies; global priorities shift to food/energy security; emissions growth unchecked; long-term planning difficult; by 2030s-2040s, worsening chronic and acute impacts force retailers to invest heavily in adaptation; by 2050, chronic impacts combined with acute events severely disrupt sourcing and logistics; rising commodity prices and frequent shortages lead to public disorder.

Orderly scenario: Moderate physical and transitional risks with steady policy and technology change. Too Little, Too Late: High physical and transitional risks with delayed global action and late-stage severe impacts. Hot House: Extreme physical risks with minimal transitional risk due to continued fossil fuel reliance. Scenario analysis identified climate-related risks and opportunities across product portfolios (Asset Finance, Rural/Livestock, Reverse Mortgages, Motor Finance, Online Home Loans). Physical risks assessed as low overall but transitional risks more significant, particularly for transportation, agriculture, and property sectors. Risks identified as capable of affecting borrower viability and asset values. Customized scenarios developed for New Zealand and Australia with separate narratives. Risks and opportunities scored on likelihood and impact, aggregated across scenarios to assess materiality.

Transition risks (regulations, technology, investor/lender requirements, supply chain, urbanisation) anticipated to have greatest impact in orderly and disorderly scenarios over medium term. Physical risks (acute weather events, chronic temperature/sea level changes) anticipated to have greatest impact in disorderly and hot house scenarios over longer term. Specific exposures quantified: 7 properties to fluvial flooding, 11 to pluvial flooding, ~39 to windstorm, 14 to heatwaves by 2050, 1 to significant sea level rise by 2100.

Scenario analysis conducted using FSC Climate Scenario Narratives aligned with NGFS scenarios. Orderly scenario represents medium transition risk and low physical risk. Too Little Too Late represents high transition risk and medium physical risk. Hot House World represents low transition risk and high physical risk. Analysis identified potential physical risks across industrials (26% portfolio exposure), utilities (11%), and healthcare (17%) sectors. Transition risks identified in industrials and utilities sectors. Portfolio TVaR declined from -3% (2024) to 4% (2025) based on 2050 scenario, indicating relatively small climate risks compared to other risks like technological disruption and competition.

Orderly scenario: immediate policy action, fast technology change, moderate physical and transition risks. Disorderly scenario: delayed policy until 2030-32, then rapid change, moderate physical and high transition risks, supply chain constraints. Hot House World: no additional climate policy, extreme physical risks, low transition risk but severe financial/economic disruption. Key drivers identified: insurance, extreme weather events, scarcity of low carbon materials, spatial strategies, land use change. Portfolio assessed as not at significant risk from sea-level rise by 2050, but moderate risk from flooding under Scenario 3 long-term. Insurance retreat likely for floodplain properties by 2040-2050.

Scenario analysis reveals inverse relationship between transition and physical risks. Orderly Transition imposes moderate transition risks but avoids worst physical impacts. Disorderly Transition creates steeper, more disruptive transition with moderate physical risks. Business As Usual creates extreme physical risks but minimal transition pressure. Physical risks to assets range from NZ$13.1M (short-term, all scenarios) to NZ$136M-173M (long-term, depending on scenario). Transition risks (Technology Adoption + Competitive Positioning) range from -NZ$12M to +NZ$50M currently, with medium-long term impacts of NZ$16M-19M (risk) to NZ$63M-75M (opportunity). All modelled impacts remain below 1% of revenue or assets. Company maintains strong financial position with no anticipated changes to funding sources from climate factors.

Scenario analysis conducted using FSC Climate Scenario Narratives and NGFS datasets. Orderly scenario (1.5°C): Medium transition risk, low physical risk; steady emissions decline at 3.4% p.a., global net zero by 2050, NZ temperature increase 0.7°C by 2050. Too Little Too Late (2°C-2.6°C): High transition risk, medium physical risk; emissions decline only 1.0% p.a., NZ temperature increase 0.8°C by 2050, 1.4°C by 2100, increased drought and flooding. Hot House World (>3°C): Low transition risk, high physical risk; minimal emissions reduction (0.4% p.a.), NZ temperature increase 1.0°C by 2050, 3.0°C by 2100, severe physical impacts including sea-level rise 0.79m by 2100. Portfolio TVaR declined from 1% (2024) to 0% (2025) based on 2050 scenario. Portfolio VaR remained at 0.2% (2050 scenario), same as base year.

Teal scenario: coordinated climate action, rapid emissions cuts, global carbon price, renewable investment, electrification and smart demand. Purple scenario (new, replacing Blue): geopolitical fragmentation, rapid tech advancement, rising inequality, deindustrialisation, energy volatility, uneven benefits. Amber scenario: slower tech progress, costly transition, supply shortages, capital retreat, government intervention, infrastructure strain. Maroon scenario: cooperation unravels, emissions climb, NZ hit hard by trade contraction and climate shocks, reactive energy system. Renewable energy percentage in 2050 ranges from 46% (Maroon) to 89% (Teal). Average hot days in 2031-50 range from 25 (Teal) to 30 (Maroon).

Low Warming (Net Zero 2050) scenario: transition risks and opportunities more pronounced in short to medium term; rapid consumer preference shift toward sustainable products; minimal physical risks. Medium Warming (NDC Base Case): balanced mix of escalating physical risks and gradual transition policy changes; extreme weather increases in frequency/severity over medium to long term; identified risks and opportunities assessed under this scenario. High Warming (Current Policies): delayed/failed climate action; low transition risks but significantly increased physical risks including extreme weather frequency/severity over medium to long term. Resilience assessment found business model and strategy resilient across all scenarios and time horizons due to geographic diversification, omni-channel capability, demonstrated margin management, and adaptive product range management.

MCK developed entity-level scenarios tailored to focus on climate drivers with material impact to the business, drawing from tourism sector scenarios (Aotearoa Circle) and property/construction sector scenarios (NZGBC/Beca). Scenarios assume NZ population of 6.93m in 2050. Orderly scenario: immediate policy action, fast technology change, moderate physical risk, moderate-high transition risk. Disorderly scenario: delayed policy action until mid-2030s, slow then fast technology change, moderate physical risk, high transition risk. Hot House scenario: no additional policies, slow technology change, extreme physical risk, low transition risk. Key 2050 indicators vary significantly: sea level rise ranges from 0.2m (Orderly) to 0.32m (Hot House); hot days >25°C increase by 15 days (Orderly) to 30 days (Hot House); carbon price ranges from $277/tonne (Orderly) to $35/tonne (Hot House); NZ net emissions range from 6 MtCO2e (Orderly) to 40 MtCO2e (Hot House). Scenarios used to assess material climate-related risks and opportunities across time horizons.

Under Orderly scenario: low physical risk exposure medium-long term; high transition risk short-medium term. Under Disorderly scenario: high-extreme transition risk short-medium term due to delayed investment and sudden policy shift post-2027; carbon price rises from $22.42 to $461.45/tCO2e by 2035; supply shocks from resource scarcity and weather events. Under Hot House World: little-no transition risk; high-extreme physical risk long-term; frequent severe weather events; reactive government response; infrastructure damage reduces logistics margins; primary sector vulnerability threatens customer base. Orderly scenario transition completed by ~2050. Scenario analysis refresh conducted FY25 to capture macroeconomic, geopolitical changes and emerging climate science.

Napier Port's climate-related risk assessment uses downscaled IPCC AR6 Shared Socioeconomic Pathways (SSPs) adapted to Hawke's Bay regional level. Under SSP1-2.6 (1.5°C), risks remain manageable in short-term with some productivity gains in forestry/horticulture offset by moderate extreme weather. Under SSP2-4.5 (2-3°C), significant increases in drought stress, pest/disease pressure, extreme weather frequency, and infrastructure impacts emerge by 2070. Under SSP3-7.0 (3°C+), severe impacts manifest including productivity declines, major water scarcity, significant livestock stress, and large portions of port site potentially impacted by coastal inundation by 2100. Sea level rise is accelerating and almost certain under all scenarios. Relative sea level rise (RSLR) at Napier Port sites averaging 2.83mm/year subsidence. In short-term (2040), no difference between SSP pathways for extreme coastal flooding; by 2070 and 2100, impacts expand significantly. Tropical cyclone severity increases across all scenarios (PDI increases 19% in SSP3-7.0). Regional primary industries (forestry 66% of exports, horticulture 7%, agriculture 4%) face increasing climate stress with productivity and viability impacts varying by scenario. Financial implications quantified for key risks: RSLR fortification $6-100m; extreme rainfall $5-10m; tropical cyclones $10-15m; rail infrastructure $10-15m; drought trade loss $15-20m. Assessment identifies 69 climate-related physical and transition risks and 24 opportunities.

Scenarios based on Aotearoa Circle's 'Climate-related risk scenarios for the 2050s' (Marine/Seafood Industry) and Network for Greening the Financial System, adapted for NZKS. Kahawai describes orderly net-zero transition with carbon-neutral aquaculture by 2050, flexible marine governance, and NZ competitive advantage. Disorderly scenario shows delayed emissions reduction until 2030, slower decarbonisation, reactive business responses, higher costs. Mako describes rapid climate disruption, increased environmental stressors, slow government policy, prohibitive adaptation costs. Physical impacts range from +0.8°C coastal sea surface temperature (Kahawai/Disorderly) to +1.5°C (Mako); sea level rise 0.23-0.28m; ocean acidification 8.0-7.94 pH; dissolved oxygen decline 1-2%. Current management responses do not differ significantly across scenarios due to commercial viability constraints or limited optionality. NZKS became Aotearoa Circle partner in FY25 to collaborate on Seafood Nature, Climate and Te Ao Māori Scenarios (finalising FY26). No material change expected to currently disclosed risks/opportunities from updated scenarios.

Scenario analysis indicates that climate-related risks and opportunities are likely to affect the portfolio unevenly across land uses, regions and time horizons. Climate-related performance is likely to diverge increasingly between stronger and weaker assets over time. Factors such as water security, physical resilience, tenant capability, alternative land-use pathways and broader location quality are likely to become more important to land value, lease durability and long-term portfolio performance. NZL's diversification across land uses, geographies and tenants remains an important source of resilience. More emissions-intensive land uses, particularly pastoral systems, are likely to face greater transition sensitivity over time, alongside potential exposure to physical stressors such as heat, drought and water pressure. Horticulture may offer attractive diversification and portfolio quality benefits at the right sites. Forestry remains relevant both as a diversification tool and as a source of resilience, optionality and vegetation-based removals.

Orderly scenario: Effective decarbonisation policies, rapid but steady emissions decline, moderate transition risk, lower physical risks. Disorderly scenario: Delayed policy response until mid-2030s, highest transition risks, medium physical risks, significant compliance costs for aged care sector. Hothouse World: Limited effective policies, emissions continue rising, extreme physical climate risks, fewer policy/market transition risks but severe physical impacts. Scenario analysis tested resilience of business model and strategy; outputs informed Board strategy day and transition planning. Scenarios incorporated driving forces from both Construction/Property and Health Sector scenarios, adapted for aged care context.

Orderly scenario: Transition risks initially increase in short/medium term before reducing as society shifts to low carbon economy; physical risk remains relatively low; global economy benefits from stable transition. Too Little Too Late scenario: Misaligned and delayed transition; transition risk increases rapidly in short term, plateaus in medium term, increases again in long term; physical risk climbs steadily; wide-ranging acute and chronic impacts result in significant financial impacts. Hothouse scenario: Minimal action; limited transition risk but significant materialisation of acute and chronic physical risks; environmental outcomes severe with coastal flooding, water stress, droughts; financial impacts felt across all economies. Fund's diversification across regions and property end-uses helps mitigate idiosyncratic climate impacts across scenarios.

Radius Care undertook scenario analysis across three climate scenarios to identify climate-related risks and opportunities and assess business model resilience. Physical risks escalate significantly in the Hothouse 3.0°C scenario, with extreme rainfall increasing by 16 days annually, extreme heat days increasing by 30 days, and sea level rise of 0.32m. Transitional risks are moderate to high in the Orderly 1.5°C scenario due to delayed transition beyond 2030, but limited in the Hothouse scenario due to lack of regulation. Financial impacts assessed as low to moderate in Orderly scenario, with supply chain disruptions being most severe in Hothouse scenario. No material financial impacts identified in FY25.

Transition risks and related opportunities impact from medium-term (2030) onwards, with physical risks gaining traction from long-term (2050) onwards across all scenarios. In Rapid Transition scenario, material transition risks (carbon pricing, capex for emissions reduction) emerge in medium-term; physical risks not expected to be material by 2050. In Status Quo scenario, transition risks emerge in long-term; physical risks increase significantly but not expected to be material before 2050. In Limited Climate Action scenario, no material transition risks identified; physical impacts expected to be below materiality threshold by 2050 but significant beyond. Preliminary assessment found no significant potential impacts of climate change on four strategic pillars that would necessitate material changes to business model and strategy.

Scenario analysis identifies climate-related risks and opportunities across three warming trajectories. Net Zero scenario assumes rapid policy coordination and accelerated decarbonisation with low physical impacts. Disorderly scenario reflects delayed and uncoordinated transition with medium physical impacts and higher costs. Hothouse scenario assumes limited policy action with high physical impacts and severe economic/social disparities. Scenarios inform risk assessment across short-, medium- and long-term horizons aligned to Ryman's planning framework.

Three scenarios tested against six priority climate risks/opportunities. Kahawai scenario: moderate transition risks, low-medium physical risks, global fisheries decline ~10% but NZ fares better with relative stability in marine primary production. Divergent Net Zero: high transition risks (severe carbon price impacts), medium-high physical risks, global fisheries decline ~5%, NZ fares better but marine sector heavily affected by fossil fuel reliance and carbon pricing. Mako scenario: low transition risks (policy removed), extreme physical risks, global fisheries decline, warm-water species migrate south, cold-water species extend south with quota allocation changes, increased time at sea and energy effort required. All scenarios show vulnerability of 100% of Sanford's business activities to both physical and transition risks in absence of mitigation.

Scenario analysis conducted using Agri-Adaptation Roadmap framework supplemented with Urban Intelligence climate projection modelling. August 2024 update from Urban Intelligence validated appropriateness of scenarios, confirming increase in higher temperatures, decrease in frost days, and more summer rainfall. Analysis covers physical and transition risks across three scenarios representing different mitigation/adaptation pathways.

Scenario analysis identified 15 climate-related risks and 10 opportunities across physical and transition categories. Net Zero 2050 scenario presents moderate transition risks but strong market opportunities for automation/robotics growth, increased mineral demand, and customer loyalty for climate-leading companies. Delayed Transition scenario presents highest transition risks (policy uncertainty, regulatory chaos, supply chain friction, insurance/finance constraints) but still opportunities for rapid transitioners. Hot House World scenario presents severe physical risks (infrastructure degradation, supply chain collapse, workforce attrition) but paradoxically creates opportunities for automation/adaptation solutions. All three scenarios impact Scott's protein processing, mining, materials handling and appliance manufacturing sectors differently. Mining sector shows growth opportunity in Net Zero and Delayed scenarios but faces demand volatility. Protein processing faces headwinds in orderly transition but opportunities in alternative markets.

Sustainable scenario (1.5°C) presents generally favourable growing conditions with manageable climate disruptions and opportunities to expand kiwifruit production into new regions. Middle-of-the-road scenario (2.1-3°C) characterised by increased weather variability and climate-related disruptions requiring greater investment in resilience and adaptation. Challenging scenario (3.1-4°C) presents more frequent extreme weather events and changing growing conditions, with some regions potentially becoming less suitable for existing varieties, requiring adaptation, diversification or changes to production systems.

Orderly scenario: rapid low-carbon transition with significant shift from road to rail and coastal shipping; altered cargo structure with lower agricultural output and reduced petrol imports. Disorderly scenario: business-as-usual until climate disasters trigger sudden transition; severe cargo volume changes and stranded assets. Hot House scenario: continued fossil fuel reliance; cargo volumes increase due to stable agricultural output in Southland. Physical risks range from moderate (Orderly, Disorderly) to extreme (Hot House). Transition risks highest in Disorderly scenario. South Port's business model exposed to maximum plausible physical and transitional risks across all scenarios.

Orderly scenario: High transition risks in short-term due to early implementation of climate policies; low physical risks throughout. Disorderly scenario: Low transition risks short-term but high medium-term as NZ rushes to meet net zero by 2050; moderate physical risks medium to long-term. Hothouse scenario: Low transition risks throughout but extreme physical risks medium to long-term. Most material short-term risks and opportunities relate to transition to low-emissions economy; physical risks remain low in short-term.

Summerset developed stand-alone scenarios by synthesising Construction & Property Sector and Health Sector scenarios. Orderly 1.5°C scenario: coordinated international effort, proactive regulatory change, fast technology and behaviour change, moderate physical risk, low-moderate transition risk. Disorderly 2°C scenario: delayed policy action until 2030, then rapid stringent decarbonisation, moderate-major GDP impacts, high transition risk, moderate physical risk. Hot-house World >3°C scenario: nationalism focus, deprioritised climate action, no regulatory controls, severe physical impacts, low transition risk, high socio-political instability. Regional climate projections provided for all village locations showing increases in hot days and precipitation changes under worst-case scenario.

Orderly scenario presents moderate transition risk and lower physical risk exposure. Disorderly scenario presents highest transition risks due to delayed policy followed by sudden intervention, and moderate-to-high physical risks. Hot House World presents low transition risks but extreme physical climate risks including supply chain disruption, land use changes, and severe production impacts. Temperature-related risks (hot days >25°C and very hot days >30°C) are most significant, with all assets rated Extreme for hot days and 70% rated Extreme for very hot days. Physical risk modelling using GIS and NIWA data shows 20% of assets have high/extreme exposure to windy days, 90% to dry days, and 100% to potential evapotranspiration deficit.

Orderly scenario: immediate technology-driven transition with stringent climate policies; high transition risks in short-term but lower physical risks. Delayed & Disorderly: slow transition until 2030 then rapid change; high volatility and complexity in medium-term; medium-high physical risks. Hot House World: only current policies preserved; low transition risk short-term but extreme physical risks increasing over time; economic costs diverge significantly after 2040. thl's material CR&Os assessed across all three scenarios; impacts vary by timeframe and scenario.

Orderly scenario: High transition risk short-to-medium term; low physical risk. TAG becomes leading used EV retailer by 2050. Disorderly scenario: Medium physical risk, high transition risk post-2035. Moderate pace of transition; ICE vehicles remain in rural areas. Hot House scenario: High physical risk long-term; low transition risk. ICE market remains strong short-to-medium term; used car market transitions slowly to LEVs/hybrids. All scenarios show TAG's business model can adapt due to rapid inventory turnover and integrated ecosystem.

Ventia assessed exposure to climate-related risks and opportunities across all sectors using four future climate scenarios ranging from 1.5°C to >3.0°C warming. Scenarios were tailored to Ventia's business through interviews with internal stakeholders to assess impacts on operations, customers and supply chains. Three clear climate-related themes identified: (1) Enhancing collaboration with customers on resilience; (2) Leveraging Ventia's ability to support transition; (3) Understanding long-term contract exposure to climate risks. In 1.5°C scenario, fast reduction of emissions required with rapid decline in fossil fuel use and worst physical impacts avoided. In >3.0°C scenario, severe physical impacts with supply chain disruptions; fossil fuel consumption continues to grow to 2050.

Three integrated climate scenarios developed in 2023 with KPMG NZ to test business model resilience. Scenarios are tailored to Vista Group's drivers of change and focus on Australasia, North and Central America (including Mexico), and Europe. Each scenario presents unique and difficult challenges. Net Zero 2050 scenario shows immediate economic turbulence but medium-to-long-term benefits, with consumers committing to sustainable lifestyles and cities becoming denser around public transport. Delayed Transition scenario shows sharp economic downturn followed by eventual stability, with climate migrant crisis and drastic government policies. Current Policies scenario shows physical impacts exerting increasingly significant downward pressure on economy, with consumption remaining energy and material intensive, soaring food prices, and climate migration intensifying. Scenarios not intended as probabilistic predictions but to interrogate assumptions underpinning critical business decisions.

Many material transition risks could first have material effects in short to medium term while physical risks anticipated to build through medium term and intensify in long term. Net Zero 2050 tests adaptation to fast policy change and low-carbon economy. Delayed Transition tests ability to respond quickly if risks compound. Current Policies tests resilience to most severe physical impacts. Findings reinforce current strategic initiatives (hub-and-spoke network, hybrid model, adaptable product sourcing, lean capital model) as providing genuine flexibility to respond to physical risks, managed retreat, and changing demand.

Customer CTP Evaluation framework assesses alignment to Paris Agreement well-below 2°C goal. No explicit scenario analysis results disclosed for 1.5°C, 2°C, or other climate scenarios.