Is 2026 the Turning Point? Shocking Climate Progress Reveals Who's Winning and Losing!

As the world moves into 2026, the ongoing battle against climate change remains a pressing issue, highlighting a stark contrast in progress across different regions. A recent report titled the 2026 Outlook for ESG Country Key Themes, published by BMI, a unit of Fitch Solutions, sheds light on the uneven advancements in climate resilience that will characterize the coming year. While highly exposed developed and upper-middle-income emerging markets (EMs) in Asia and the Middle East are expected to show significant improvements, major economies like the United States may struggle due to a combination of political and economic challenges.

The report indicates that resilience to natural disasters and climate change will continue to progress globally in 2026, but with notable disparities. Developed and upper-middle-income EMs, particularly in Asia, are likely to enhance their capacity to deal with climate impacts. This progress comes as countries recognize the urgent need to adapt to increasingly severe environmental conditions.

In contrast, the report expresses concern about the climate resilience of several major economies, especially the US. Political strife, economic headwinds, and deregulation could hinder efforts to bolster climate defenses in these regions. The UK and the EU may experience a different trajectory, as stricter physical climate risk regulations might help mitigate some of the negative impacts posed by these challenges.

One significant finding of the report is that adaptation finance—funding aimed at helping countries prepare for the impacts of climate change—will continue to favor middle-income markets with established policy frameworks and robust growth prospects, primarily in Asia. However, this financial support is expected to widen the gaps in resilience funding, leaving least-developed countries to struggle with cuts to development aid and reliance on commercial loans. The limitations of their implementation capacities may exacerbate existing inequalities both between and within countries.

While adaptation finance faces hurdles, the report also notes that nature-related finance is anticipated to surpass targets in 2026 and beyond. However, technical and political obstacles may limit the effective impact of these conservation initiatives. As the world increasingly recognizes the interconnectedness of nature and climate resilience, it remains critical to ensure that financial support translates into tangible outcomes, especially in biodiversity conservation and sustainable land management.

Social and governance factors are also poised to influence climate resilience dynamics. The report warns that disruptions related to governance and social issues will likely increase throughout 2026. High living costs, poor working conditions, and limited job opportunities could trigger protests, labor unrest, and scandals, potentially destabilizing operations in many emerging markets. This turbulent environment underscores the complexity of addressing climate change, as social stability remains a crucial factor in implementing effective climate policies.

In summary, the 2026 Outlook for ESG Country Key Themes report outlines a landscape of uneven progress in climate resilience as the world heads into 2026. While certain regions, particularly in Asia and the Middle East, strive for improvement, others, including the US, face significant obstacles. The widening gaps in adaptation finance, potential stagnation of nature-related initiatives, and rising social pressures collectively paint a complex picture of the challenges ahead. As nations gear up to tackle climate change, it will be essential to foster collaboration, ensure equitable access to resources, and prioritize social stability to build a more resilient future.