The report, funded by HSBC, examines how climate change is already imposing substantial economic and social costs in the GCC, while adaptation planning and financing have not yet caught up to the scale of the risk.
ABU DHABI, UAE –Jan 2026 – The Mohammed Bin Rashid School of Government MBRSG unveiled a landmark policy report entitled ‘Addressing the Physical Risks of Climate Change in the GCC: The Role of Policy and Finance’. It examines the escalating physical risks of climate change across the Gulf Cooperation Council GCC region and highlights the key role of policy, finance, and robust institutions in strengthening climate adaptation and resilience across the region. The report was supported by a grant from HSBC Middle East funded as part of its philanthropic outreach.
The report underscores the urgent need to address climate risks that are already impacting the GCC, evidenced by recent extreme weather events such as heatwaves and flooding. It encourages a shift away from viewing climate risks as distant threats, instead recognising their increasing relevance for communities, infrastructure, and economic resilience. The report also highlights that adaptation efforts across the GCC should be further developed, underscoring the likelihood of the cost of inaction to far exceed the cost of proactive adaptation.
The report finds that climate adaptation requires greater strategic attention alongside mitigation, as physical climate risks continue to receive limited focus in decision making. It recommends that GCC countries operationalise evidence-based National Adaptation Plans (NAPs), supported by clear governance structures, cross-ministerial coordination, and alignment with national development strategies and budgets.
“The urgency of recent extreme climate events in our region makes this report incredibly timely for socioeconomic stability in the future. Building on a wealth of data and fieldwork from MBRSG’s Sustainability Policy research track, this regional report highlights the strategic imperative, and policy roadmap for governing climate risks across GCC countries,” stated Dr. Fadi Salem, Director of Policy Research Department at the Mohammed Bin Rashid School of Government.
It offers strategic policy recommendations in four major pillars: Governance, Implementation, data and research, and Finance. The report builds on previous research collaborations between MBRSG and HSBC Middle East, providing a clear roadmap for policymakers and financial institutions to leverage robust policy, data, and coordinated action, both to adapt and to lead globally in building climate resilience.
The report details how strengthening adaptation finance through enhanced data, robust risk assessment methodologies, and innovative financial frameworks, is indispensable for safeguarding the GCC’s long-term economic stability.
To mobilise the necessary capital, particularly in the GCC, the report highlights the urgency of implementing innovative financing solutions, including blended finance, public-private partnerships, and sustainable finance frameworks.
“Climate resilience is not just an environmental imperative but a strategic driver of long-term economic stability,” stated Justin Wu, Head of Sustainability and Climate Change, Asia and Middle East. “This report underscores the critical role of the financial sector in accelerating adaptation in the GCC, by mobilising innovative financing solutions, fostering cross-sector collaboration, and embedding robust climate risk management into decision-making. Providing support to MBRSG for this project reflects our commitment to supporting evidence-based policy.”
The report emphasises the importance of strengthening climate risk management frameworks across the GCC region. Lama Zakzak, MBRSG Research Fellow and lead author of the report, noted that “while emergency responses to extreme weather events in the GCC have generally been strong, a shift is needed from reactive response to proactive risk management. This shift necessitates substantial investment in developing robust climate data systems, thorough risk assessments, effective early warning mechanisms, and dynamic monitoring frameworks to ensure adaptation strategies are evidence-based, trackable, and adaptable to complex multi-hazards and intensifying risks”
The launch panel at the Green Finance Conference during the World Future Energy Summit contributed to regional dialogue on climate resilience by bringing together government leaders, financial institutions, regulators, and climate change stakeholders.
This report contributes to MBRSG’s global knowledge base, which includes strategic indices published annually in the World Government Summit, including the Arab Region SDG Index and the Global Economic Diversification Index (EDI).
The Mohammed Bin Rashid School of Government is an academic and research institution focused on government administration and public policy in the Arab region. It aims to support the advancement of government excellence locally and regionally. The School leads dedicated policy research projects and research teams focused on sustainability and climate policy.
The full report and other research outcomes can be accessed through MBRSG’s research website: https://www.mbrsg.ae/research
