# Extreme weather risks push big companies away from poorer nations

> Multinational firms avoid climate-vulnerable countries, hurting both investors and developing nations.
- Title: Extreme weather risks push big companies away from poorer…
- Summary: Multinational firms avoid climate-vulnerable countries, hurting both investors and developing nations.
- Keywords: extreme weather risk, foreign direct investment, climate vulnerability, developing countries, multinational corporations, climate adaptation, resource access, infrastructure, water stress, flood damage, The Conversation
- Source: The Conversation — https://theconversation.com/extreme-weather-risk-is-scaring-big-corporations-away-from-poorer-countries-that-hurts-the-companies-too-295591
- Author: Jonas Gamso
- Read time: 1 min
- Topics: extreme weather risk, foreign direct investment, climate vulnerability, developing countries, multinational corporations, climate adaptation, resource access, infrastructure, water stress, flood damage, science, ideas
## Climate risk reshapes corporate investment
Multinational companies increasingly avoid climate-vulnerable countries when deciding where to build factories or open mines.
## Extreme weather impacts business decisions
Flooding in Thailand 2011 forced Toyota, Nissan and Honda to suspend production as factories flooded.
## Climate vulnerability reduces investment
Countries with higher climate vulnerability see 12% less foreign direct investment per 1-point rise on 100-point scale.
## Water stress delays major projects
Google halted a $200 million data center in Chile after environmental court revoked construction permit over water use.
## Investment avoidance costs companies
Firms with major flood losses saw 5% average decline in shareholder value within one year.
## Developing countries lose opportunities
Less foreign investment means fewer jobs and reduced access to new technologies in vulnerable nations.
## Resource-rich countries face climate risks
Democratic Republic of Congo supplies most global cobalt while Indonesia dominates nickel production.
## Climate adaptation helps investment
Countries receiving more climate adaptation aid saw increased foreign direct investment from companies.
## Investment solutions for climate risk
Climate risk insurance and better data help companies invest in vulnerable countries without avoiding them.
## Key takeaway

Climate risk reduces foreign investment in vulnerable countries by 12% per point on vulnerability scale, hurting economic growth and corporate opportunities.