Expert urges investors to shift heads toward massive new economy taking formation: 'One of the most clear and inevitable opportunities'

There's a popular but erroneous belief that "the Chinese word for crisis" is an etymological collision of the words for "danger" and "opportunity," a factoid often trotted out on LinkedIn.

A new Bloomberg piece about extreme weather and the business opportunities it presents embodies that concept in a way that is equal parts unsettling and clever, framing its increasing prevalence as a novel and leverageable economy unto itself.

What's up with extreme weather as a business opportunity?

In much of the world and in the United States in particular, the unofficial theme of 2025 has been uncertainty, be it political, financial, or in many regions, meteorological.

Uncertainty in any form is typically viewed as a liability in business, as any news pertaining to fluctuating tariffs illustrates. Jay Koh is a seasoned private equity veteran, and as such, he knows a bit about leveraging tailwinds and turning crises into opportunities.

Koh's experience ranges from the private sector to public policy, and he "serves on ​​the Board" of NYSERDA, according to his biography on the website for a firm he co-founded, the Lightsmith Group.

In other words, Koh has decades of insight and lived experience in the public and private sectors that collectively shape policy, and he believes extreme weather is an area of untapped business potential.

In a soberingly clear statement, Koh told Bloomberg that with respect to extreme weather and other impacts of an overheating planet, there was currently "more certainty about that trajectory of risk and impact than about the direction of interest rates, inflation, tariffs."

Consequently, Koh has turned his eye toward the economic opportunities introduced by climate adaptation, the business of ensuring everything in daily life is up to the task of contending with the reality of rapidly shifting conditions, like increased floods and wildfires.

Adapting the world for extreme weather is "one of the most clear and inevitable opportunities for investors," Koh maintained. 

According to Bloomberg, his admission coincided with a then-recent report estimating the adaptation market could be worth $1.3 trillion by the year 2030.

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Why is Koh's 'bet' on extreme weather important?

A modern internet adage holds that while some of the population refuses to "believe" that average temperatures are rising, their insurance companies certainly do.

Although the commentary is a meme, it succinctly speaks an uncomfortable truth: irrespective of what politicians or pundits say, flows of capital and investment tend to hew to consensus reality.

GIC Pte., Singapore's sovereign wealth fund, projected the value of the adaptation market to nearly quadruple to $4 trillion by 2050. Koh was unable to provide firm figures for his own firm's return rate on investments related to extreme weather, citing regulatory policy.

According to Bloomberg, however, "investments in adaptation deliver at least four times more benefits than costs, with a 25% annual average return rate." 

Moreover, the outlet indicated that Sarah Kapnick, global head of climate advisory at JPMorgan, said that in some business sectors, the return on investments in climate adaptation is "as high as $43 for every $1," which Bloomberg noted was a rate of return "well over 4,000%."

In May, Kapnick admitted she'd always been confounded by the "underspend on adaptation."

How the finance sector's involvement helps spur adaptation

On balance, it isn't strictly great news that extreme weather became such a reliable bet that a business magazine like Bloomberg is touting adaptation as a virtual risk-free investment.

Then again, there's that meme about insurance companies and its underlying message: business interests are often quicker to pivot toward economic realities than governments.

Experts have clamored for governments to take climate adaptation seriously with sporadic success — but when it comes to risk, commercial entities clearly know knowledge is key and inaction will be far costlier than adaptation.

Blunt assessments on extreme weather from finance and policy experts like Koh and Kapnick are the sort that drive industry and policy alike — and it's increasingly clear that the corporate world isn't just taking adaptation seriously, it's also backing it up with strategic investments.

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