What Standard Life's physical climate risk framework means for asset owners building ESRS E1 resilience disclosures

Investors are on a voyage of discovery on physical climate risk, but can make progress by using the analytical foundations already in place, according to Standard Life's Bruno Gardner and Hetal Patel, writing for Responsible Investor. The argument is significant because it pushes back against the prevailing narrative that physical risk data is too immature to act on. Gardner and Patel contend that the tools and frameworks required to begin integrating physical risk into investment and disclosure processes are available now, even if the data landscape continues to evolve.

The Standard Life position is that increasing efforts to adapt to climate change impacts alongside ongoing mitigation efforts is becoming crucial. This dual emphasis on adaptation and mitigation carries direct relevance for CSRD reporters. Under ESRS E1, companies must disclose not only their emissions trajectories but also their assessment of physical climate risks and the resilience of their business model under different climate scenarios. Standard Life's framing suggests that waiting for perfect data before engaging with resilience analysis is no longer a credible position for large organisations.

For in house ESG managers preparing ESRS E1 disclosures, the practical implication is that scenario analysis and physical risk assessment should be integrated into the current reporting cycle rather than deferred. The Responsible Investor Climate Risk and Resilience Survey 2026, produced in partnership with Standard Life, documents how asset managers and owners are building physical risk into decision making processes and the hurdles they face. That survey provides a useful benchmark for the level of analytical maturity that institutional investors now expect to see evidenced in corporate disclosures.

The gap between investor expectations and corporate disclosure practice is a recurring source of tension in CSRD assurance. Auditors and investors reviewing ESRS E1 resilience disclosures will increasingly ask whether companies have engaged substantively with physical risk scenarios or simply acknowledged them in generic terms. Standard Life's public positioning on this issue signals that institutional capital allocators are raising the bar on what constitutes a credible resilience disclosure.

The broader context is that physical climate risk is migrating from a niche analytical exercise to a mainstream investment and reporting requirement. Standard Life's view, grounded in the 2026 survey findings, is that the investor community does not need to wait for data perfection to begin connecting the dots. For sustainability consultants advising corporate clients on ESRS E1, that message from a significant European asset manager carries real weight in board conversations about how much resource to allocate to physical risk analysis this year.