The Weekly: Earnings Calls Are Full of “Resilience” Talk. But Physical Resilience Moves Stock Prices

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Earnings Calls Are Full of "Resilience" Talk. But Physical Resilience Moves Stock Prices.

According to Bloomberg’s tracking of earning call transcript data, S&P 500 companies mentioned "resilience" roughly 600 times last quarter, up from under 100 a decade ago. News mentions of the term have followed the same trajectory, climbing steadily since the pandemic.

The term, says University of Zurich researcher Tobias Schimanski, “can cover all sorts of things,” from cyber security to “AI resilience” to cash reserves. As the term explodes, it risks losing its specificity—particularly for decision-makers focused on physical resilience.

Any insurer underwriting a property, investor pricing a bond, or public official evaluating a grant application needs to know whether "resilient" means physically resilient (a wildfire-fortified neighborhood, new resilient public infrastructure, etc.) or resilient in the broader sense.

Schimanski’s new research offers a way to dissect a broad term into more useful sub-categories. Using large language models trained on filings from more than 13,500 firms, the research sorts corporate climate disclosures into five categories, starting with the most concrete and moving to the “most shallow” activity: 

1. Physical protection: Physically hardening or redesigning assets and infrastructure to withstand climate hazards.
2. Adaptive operations: Restructuring operations, supply chains, or locations to keep the business running through climate disruptions.
3. Risk transfer: Shifting the financial cost of climate risk—typically through insurance.
4. Financial reserves: Setting aside internal capital or self-insurance funds to cover recovery costs.
5. Risk assessment: Identifying and measuring a firm's exposure to climate risk, without necessarily acting on it yet.

Those categories reveal what types of “resilience” actually make a difference to Wall Street. Schimanski found that following hurricane landfalls, firms that had disclosed physical protection measures, like flood walls or hardened facilities, saw their stock prices recover markedly better than exposed peers without those disclosures, offsetting roughly 26% of the average negative reaction over the following month. 

“Among the different adaptation categories, physical protection emerges as the only dimension that significantly mitigates these negative effects,” writes Schimanski. 

Schimanski’s hypothesis about why this is the case is tied to credibility: “I think physical protection is a credibility signal,” he said in a Climate Proof webinar. “If you think about adaptation, the first thing that comes to your mind is probably: I build a flood wall, or I build fire-secure infrastructure. That is actually what physical protection measures are.” 

Among financially constrained firms, even physical protection stopped mitigating losses. Investors appeared to discount resilience claims from companies that looked unable to implement or maintain them.

In 2025, Schimanski says, 90% of firms talked about physical climate risk. “However, only about 20% disclose some kind of adaptation.” 

Firms that can point to specific, verifiable, physical protection measures—with evidence of what was built and how it reduces risk—will have an advantage as the resilience rhetoric becomes more commonplace. Private sector operators and investors, as well as municipal leaders, will need to show that evidence.

The Epicenter Posts You Might Have Missed:

• The Great Unlock | Xavier de Souza Briggs and Matt Posner | How public, private, and philanthropic leaders can scale the next chapter of climate resilience. A national call to action prepared for Chicago Climate Week and Aspen Ideas: Climate.
• Financing the Missing Asset: Why Municipal Bonds Have Struggled to Finance Climate Resilience | Matt Posner | Bespoke deals are too complex to scale. Broad “green” designations are too vague to measure. A middle route can fund adaptation at the pace climate risk demands.
• Should Wood Be a Public Utility? | The Epicenter Editors | Treating wood as a public utility, rather than a waste product, could reduce fire risk, support insurer re-entry, and unlock economic value that currently goes up in smoke.

What We’re Reading From the Resiliency Ecosystem

Public Infrastructure

• Extreme Weather Resilience: Why It Matters And How We're Building It | Actis | A white paper from infrastructure investor Actis argues that resilience measures can protect asset values, lower insurance risks, and generate outsized returns, citing research showing every dollar invested in adaptation can produce $10–12 in avoided losses and broader economic benefits. 
• Paying for Resilience in New York State | Rebuild by Design | Rebuild by Design estimates New York faces at least $519 billion in public adaptation costs, including stormwater upgrades, culvert replacements, and coastal defenses. The report argues that the figure is likely an underestimate, and that without dedicated, long-term funding, taxpayers will shoulder the growing costs of extreme weather. 
• Fierce Floods or Wild Waves? How San Diego Is Preparing for a Winter of Extreme Weather Under El Niño | CalMatters | A forecasted "super El Niño" has San Diego preparing for everything from catastrophic flooding to coastal erosion. The risks are revealing the vulnerabilities in aging stormwater systems, century-old dams, and decades of deferred resilience investment.

Read more about resilient public infrastructure on The Epicenter here.

Real Estate & Construction

• As Wildfires Burn Across Colorado, Here's an Updated Insurance Breakdown for Homeowners | The Colorado Sun | Colorado's latest wildfire season is testing a homeowners insurance market already under strain. This article explains how Colorado is implementing new consumer protections, including faster policy access, simplified claims for total losses, and wildfire risk score disclosures. It also highlights the state's brand-new Strengthen Colorado Homes program, which will fund grants for home-hardening projects.
• Why Wildfire Risk Can Vary from One Home to the Next | Mercury Insurance | Two neighboring homes can have dramatically different wildfire outcomes. Drawing on research from IBHS and CAL FIRE, Mercury Insurance explains how embers, topography, wind patterns, construction details, and the five-foot defensible space around a home all shape wildfire risk. 
• The Floods of the Future Won’t Come One at a Time | Yale Climate Connections | Coastal communities face a growing threat from compound flooding, when storm surge and extreme precipitation collide. New research shows these combined hazards could dramatically increase flood risk, putting homes and coastal real estate markets under mounting pressure. 

Read more about resilient real estate on The Epicenter here.

The Chart of the Week 

Source: ClimateCentral 

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The Epicenter helps decision makers understand climate risks and discover viable resilience solutions. The Epicenter is an affiliated publication of The Resiliency Company, a 501(c)3 nonprofit dedicated to inspiring and empowering humanity to adapt to the accelerating challenges of the next 100+ years.