The 2024 FM Resilience Index – an annual ranking of 130 countries and territories by the resilience of their business environments – highlights Europe’s unparalleled leadership in business resilience. The FM Resilience Index offers businesses a comprehensive tool to assess and enhance their resilience, helping companies identify vulnerabilities and strengths and allowing for improved strategic planning and risk management.
In 2024, eight of the top 10 most resilient countries are European, including Denmark, Luxembourg, Switzerland, Germany, Sweden, Finland, Norway, and Belgium. The UK also ranked high coming in at 15th – further highlighting Europe’s strong performance – driven in part by a solid position regarding robust cybersecurity measures. Despite challenges such as inflation and supply chain disruptions, which have affected its overall ranking, the UK’s ability to adapt and mitigate risks underscores the broader European trend of prioritising sustainability and proactive risk mitigation. This approach has enabled European countries to create resilient environments that foster business stability and growth, even in the face of emerging global challenges.
Climate Risk Management
In many ways, Europe presents a great example of why investing in climate resilience is so important when it comes to cultivating successful business environments. Historically Europe has not been as severely impacted by climate risk, compared to Asia or the Americas, but we’re starting to see that trend change with more frequent extreme weather events – such as heavy precipitation and flooding, strong winds, hail-and thunderstorms, heatwaves, wildfires, and droughts – taking place each year.
Meeting this growing challenge, many European countries are leading the way by implementing comprehensive strategies to address and adapt to extreme weather events. European businesses often benefit from comprehensive risk management frameworks that integrate climate considerations into all aspects of operations. The European regulatory landscape has in part helped structure this, helping to create consistency in the implementation of effective climate policies and risk management approaches. This regulatory framework has driven accountability in many territories and facilitated long-term planning of resilience-building programs.
Denmark is a prime example of excellence in climate risk management, ranking in the top 25 for both Climate Risk Exposure and Climate Risk Quality in the FM Resilience Index. The country has implemented extensive flood defences and coastal management systems to protect its low-lying areas from rising sea levels and extreme weather events, minimising flood risks to businesses and communities and enabling quick recovery from such events.
Germany – which ranks an impressive 16th for Climate Risk Quality – also integrates climate risk management into urban planning with initiatives such as the Green Roof Strategy in Hamburg and the Berlin Strategy 2030. Both programmes look to adapt major urban areas to climate change by enhancing green spaces and improving drainage systems, ensuring cities can withstand and quickly recover from environmental shocks.
Energy Transition
Beyond developing climate resilience, Europe also presents numerous examples of countries leading the energy transition – critical for long-term resilience, as it reduces dependency on volatile energy markets and contributes to mitigating climate change.
For example, Norway is focusing on the renewable energy transition, mainly through its extensive use of hydropower, which accounts for nearly 64% of all its energy consumption. This leadership in renewables not only ensures energy security but also positions Norway as a leader in the global shift toward a low-carbon economy. Furthermore, Norway’s proactive adoption of electric vehicles (EVs), mainly via tax incentives, has made it a leader; over 80% of new car sales in 2023 were electric. This shift reduces greenhouse gas emissions and promotes sustainable transportation, further enhancing the country’s resilience.
Sweden is another country at the fore front of the energy transition, with a goal to achieve 100% renewable electricity by 2040. Sweden is also pioneering in biomass energy, using forest residues and waste for heat and power production. This is highlighted in the FM Resilience Index, as Sweden ranks 4th regarding GHG Emissions, capturing GHG emitted per unity of productivity. It is clear that Europe’s commitment to technological advancement, particularly in renewable energy and smart infrastructure, plays a role in underpinning its resilience.
Global Context
While much of the national examples highlighted by the FM Resilience Index are positive in Europe, part of the wider international story also involves other regions experiencing adverse risks. Many countries and territories, for instance, face significant challenges due to climate change and geopolitical instability. Conflicts in regions such as Gaza and Ukraine demonstrate the impact geopolitical conflict can have, triggering instability for global supply chains and economies.
Countries outside of Europe also often face persistent issues regarding managing cyclical, and increasingly severe, climate risks – which are reflected in the Resilience Index rankings. For instance, Bangladesh is notably vulnerable due to its exposure to frequent flooding and cyclones exacerbated by climate change. The country’s dense population in coastal regions makes it particularly susceptible to rising sea levels and extreme weather events, which contribute to widespread humanitarian and economic impact.
This situation highlights a broader issue faced by many non-European countries where inadequate resource management, limited technological infrastructure, and higher climate risk exposure hinder their ability to mitigate the effects of climate change. While regions like Europe benefit from proactive climate policies, investments in technology, and effective resource management, countries like Bangladesh demonstrate how critical these factors are in building resilience against climate-related challenges.
Implications for Global Businesses
The 2024 FM Resilience Index highlights Europe as an example for other regions, providing a blueprint for building resilient business environments that can withstand and thrive amid rising global challenges. Global businesses can draw valuable lessons from Europe’s leadership in climate risk management and energy transition. By adopting similar proactive and innovative strategies, countries worldwide can enhance their resilience and ensure sustainable growth. Key takeaways include:
- Adopting Comprehensive Risk Management: Incorporating climate risks into business planning and operations to mitigate potential impacts.
- Investing in Renewable Energy: Shifting toward renewable energy sources to ensure a stable and more sustainable energy supply, while ensuring any additional risks created by this move are identified and mitigated.
- Embracing Technological Advancements: Leveraging smart technologies to improve efficiency and adapt to changing environments.
Written by Bill Bradshaw, Operations Manager for FM in the UK
