The impacts of climate change are being felt globally and pose a considerable challenge, especially in countries of the Global South. The German Sparkassenstiftung for International Cooperation (DSIK) supports people, companies and financial institutions in meeting the challenges of climate change and strengthening their resilience. Its approach ranges from direct support for rural enterprises to the implementation of climate risk management in financial institutions. DSIK strategically strengthens companies and financial institutions in climate protection by using innovative tools such as the ESG Risk Radar and the Sustainable Finance Compass as well as the Managing Climate Resilience Business Game. These approaches help to integrate climate protection aspects more strongly into financing structures, make agricultural businesses affected by climate change more resilient and promote dialog between politics, business and civil society.

Adaptation of businesses to climate change

Businesses, especially in rural areas, are severely affected by climate change. The consequences range from production losses to destroyed infrastructure. German Sparkassenstiftung strengthens its target groups (small enterprises, farmers and cooperatives) so that they can adapt successfully:

• Minimizing risk for businesses:
  Small businesses, farmers and cooperatives learn to identify risks at an early stage and implement mitigation measures.
• Resilient business models through the Managing Climate Resilience Business Game:
  Businesses are supported in making their business models more resilient in order to remain economically successful in the long term. To this end, DSIK uses the Managing Climate Resilience Business Game, an interactive training course to teach agricultural businesses and smallholder farmers strategies for adapting to climate change.

Financial institutions also play a key role when it comes to tackling the climate crisis. DSIK works closely with local banks, microfinance institutions and other financial actors to provide them with the tools and knowledge needed to identify both the risks and opportunities of climate change:

• Training and knowledge transfer:
  Financial institutions learn to identify and respond to climate-related risks and opportunities in a targeted manner.
• The Sustainable Finance Compass:
  This tool supports banks in developing sustainable financing strategies and investing in ecological transformation.
• Use of the ESG Risk Radar:
  This tool helps financial institutions to identify environmental, social and governance (ESG) risks and develop strategies to manage them.
• Promotion of climate-resilient projects:
  By working with DSIK, financial institutions can not only manage their own climate risks but also promote companies and projects that contribute to climate change adaptation.

With these approaches, German Sparkassenstiftung is helping companies and financial institutions to overcome climate-related challenges and also seize opportunities for sustainable development.