The growing recognition of climate as a financial risk shows the need for comprehensive assessment tools. Climate risks must be integrated into business and financial analyses to accurately determine creditworthiness, investment value, and corporate stability. Without consistent metrics and assumptions, evaluations may underestimate future expenses and overstate resilience.
“It is no longer sufficient to treat extreme weather as an occasional disruption. These risks are now material and measurable and a standardised framework for assessing climate-related risks could transform how businesses plan and invest in Malta” says Earth Systems & Climatology Specialist Charles Galdies.
A research project supported by Xjenza Malta is currently exploring the development of such a tool.
Known as SHIELD – Socio-economic and Hazard Intelligence for Exposure and Layered Data, the project focuses on creating an AI-driven climate risk solution designed to be practical and accessible for a range of stakeholders. This study is being conducted with a defined geographic scope of Marsalforn, Gozo.
“This project is still in its early stages but if successful, it would give Maltese companies and investors a reliable method to integrate climate impacts into their decision-making, enhancing both operational and financial resilience,” adds Gabriella Borda, Founder Climate Delta.
The initiative reflects a broader shift where climate change is no longer solely an environmental concern but a critical factor shaping business strategy. For decades, Maltese hot summers have always been part of daily life and rarely treated as more than a minor inconvenience.
“That perception is increasingly untenable. Rising temperatures are now a tangible occupational risk, particularly for those working outdoors, and businesses are beginning to feel the economic implications,” says Borda.
The Occupational Health and Safety Authority’s (OHSA) recent introduction of mandatory extreme-weather measures represents a critical acknowledgment of this shift.
“Employers and workers alike must recognise that certain conditions make normal work routines unsafe. These measures are practical adjustments, not bureaucratic burdens,” added Galdies.
Historical data underscore the urgency. According to The State of the Climate 2022, Malta’s long-term weather records show a clear warming trend. Between 1952 and 2020, mean maximum temperatures rose by 1.5°C, and mean minimum temperatures increased by 1.4°C. Warmer nights and mornings reduce recovery time, leaving outdoor workers exposed to prolonged heat stress exacerbated by radiant surfaces, physical exertion, and protective clothing.
For sectors such as construction, utilities, road maintenance, and municipal services, this is a material concern.
Borda emphasised that “when workers slow down in extreme heat, they are not underperforming but responding to conditions that can seriously affect their health. Recognising this is critical for both safety and productivity.”
OHSA’s rules mandating risk assessments, contingency planning, temporary suspension of work, and structured return-to-work procedures are necessary adaptations to a changing climate.
Malta’s location in the central Mediterranean amplifies the risks.
The region is recognised internationally as a climate-change hotspot, warming faster than the global average. Projections indicate heatwaves will become more frequent, intense, and prolonged, extending thermal stress beyond the traditional summer months. Implications for outdoor labour include increased fatigue, reduced concentration, elevated error rates, and higher accident risk.
Economic ramifications are equally pressing.
Heat stress undermines productivity, disrupts schedules, and elevates operational costs. Across Europe, climate extremes including heatwaves, floods, droughts, and windstorms have generated substantial financial losses.
The European Environment Agency estimates losses between 1980 and 2023 reached €738 billion. A regional study cited by The Guardian in September 2025 estimated at least €43 billion in losses for 2024 alone, with Malta among the most affected per gross value added.
For Maltese enterprises, these trends translate into moderate to high physical risks over the next decade. Businesses face not only health and safety obligations, but also potential impacts on production continuity, insurance premiums, asset valuation, and profitability. Smaller enterprises, in particular, may struggle to absorb unanticipated costs.
Implementation remains key. Regulatory guidance is necessary, but compliance, planning, and cultural change are essential to protect workers.
“Access to hydration, shade, rest periods, and safe shelters should not be seen as optional but as the baseline for workplace safety in a warming climate,” adds Galdies.
Ultimately, Malta’s response to climate change in the workplace will have both human and economic consequences. Effective adaptation safeguards employee health, preserves productivity, and mitigates financial risk.
As Borda notes, “integrating climate considerations into business strategy is no longer optional but central to corporate stability and competitiveness.
“As temperatures rise, the challenge for Malta will be to transform awareness into action, through practices that secure both human and economic resilience. The cost of inaction, both in human and financial terms, is becoming increasingly evident.”
