Selecting the right Shared Socioeconomic Pathway (SSP) scenario determines whether your climate risk analysis captures material threats or produces misleading comfort. This practical guide cuts through the complexity of SSP scenarios—from ambitious sustainability pathways (SSP1-1.9) to fragmented futures (SSP3-7.0) and fossil-fueled development (SSP5-8.5)—to answer one critical question: Which pathway should your business use for strategic planning in 2026?
This article is part of our comprehensive Climate Scenarios Series, which provides the complete foundation for corporate climate risk analysis.
The answer isn't singular—robust climate planning requires multiple scenarios. However, your industry characteristics, geographic exposure, asset longevity, strategic time horizons, and socioeconomic dependencies determine which combination delivers genuine insight versus compliance theatre. Companies with coastal facilities face fundamentally different scenario priorities than carbon-intensive manufacturers. Real estate portfolios with 50+ year horizons require different approaches than technology firms operating on 5-year planning cycles.
The SSP scenarios represent a fundamental evolution from the earlier Representative Concentration Pathways (RCP). Whilst RCPs focused exclusively on greenhouse gas concentrations and radiative forcing, SSPs integrate climate projections with socioeconomic narratives describing population growth, economic development, technological innovation, and governance structures. This integration enables more sophisticated analysis of both physical climate risks and the transition pathways needed to address them.
Current emissions trajectories have already eliminated some pathways as realistic baselines whilst making others increasingly urgent. Global temperatures have risen approximately 1.2°C above pre-industrial levels, with the 1.5°C threshold projected for the early 2030s under most scenarios. This reality constrains which futures remain plausible whilst amplifying the urgency of scenario-informed strategy.
Understanding which SSP scenarios to use—and how to integrate their socioeconomic dimensions into strategic planning—separates pragmatic risk management from paralysis-inducing over-analysis or superficial compliance exercises.
The Shared Socioeconomic Pathways were developed for the IPCC's Sixth Assessment Report (AR6), superseding the Representative Concentration Pathways used in the Fifth Assessment Report (AR5). This evolution reflects critical lessons learned from earlier scenario work:
What RCPs Provided:
What SSPs Add:
Each SSP can be combined with different climate forcing levels. For example, SSP1-2.6 combines the sustainability narrative (SSP1) with the 2.6 W/m² forcing pathway, whilst SSP5-8.5 combines fossil-fueled development (SSP5) with high emissions (8.5 W/m²). This structure enables more nuanced analysis of how different societal trajectories intersect with climate outcomes.
The socioeconomic dimensions of SSPs aren't academic abstractions—they directly affect your business through multiple channels:
Market Dynamics: Population growth and income levels determine market size and demand patterns. SSP3 describes a world with 12+ billion people but low per-capita income, whilst SSP1 projects 8-9 billion people with higher wealth. These demographic trajectories fundamentally reshape global markets.
Regulatory Environment: Governance effectiveness varies dramatically across SSPs. SSP1 assumes strong international cooperation enabling coordinated climate policy. SSP3 describes fragmented governance with weak enforcement and policy uncertainty. Your compliance costs and regulatory risks depend heavily on which governance pathway unfolds.
Technology Availability: The speed and direction of technological innovation differs substantially. SSP1 features rapid clean technology development and diffusion. SSP3 sees slow innovation with limited technology transfer. This affects both your decarbonisation options and competitive positioning.
Supply Chain Resilience: Geopolitical stability, trade openness, and infrastructure quality vary across narratives. SSP3's fragmented world with increased protectionism creates different supply chain risks than SSP1's cooperative global economy.
These socioeconomic factors often drive business risks more directly than the physical climate changes themselves—particularly over the next 10-20 years when scenario divergence in physical variables remains modest but policy and market differences become pronounced.
Socioeconomic Narrative:
SSP1 describes a world shifting toward more sustainable development patterns. The narrative assumes increasing international cooperation, effective global governance, and prioritisation of environmental protection alongside economic development and social equity. Population growth slows and eventually reverses as education levels rise globally. Economic growth emphasises quality of life over material consumption. Technological innovation focuses on clean energy, resource efficiency, and environmental restoration.
Key Socioeconomic Characteristics:
Temperature Outcome: Limits warming to approximately 1.4-1.5°C above pre-industrial levels by 2100.
Emissions Trajectory: Achieves net-zero CO₂ emissions by approximately 2050, with substantial negative emissions thereafter. Requires immediate, transformational action across all sectors.
Radiative Forcing: Peaks at approximately 2.6 W/m² mid-century, then declines to ~1.9 W/m² by 2100.
Physical Climate Characteristics:
Business Implications:
SSP1-1.9 requires revolutionary economic transformation occurring faster than any historical precedent. Carbon pricing must exceed €200-400 per tonne by 2040. Fossil fuel phase-out accelerates dramatically—coal eliminated by 2030, oil and gas substantially reduced by 2040. Massive deployment of carbon removal technologies becomes essential from 2030 onwards.
The socioeconomic context matters critically: this transformation only proves feasible within SSP1's framework of international cooperation, effective governance, rapid technology innovation, and societal acceptance of change. Attempting equivalent emissions reductions within SSP3's fragmented governance or SSP5's consumption-focused economy would likely prove impossible.
When to Use SSP1-1.9:
Temperature Outcome: Approximately 1.8°C warming by 2100, staying below 2°C.
Emissions Trajectory: CO₂ emissions decline steadily from 2020, reaching net-zero by approximately 2070. Less aggressive than SSP1-1.9 but still requires substantial transformation.
Radiative Forcing: Stabilises at approximately 2.6 W/m² by 2100.
Physical Climate Characteristics:
Business Implications:
SSP1-2.6 represents the Paris Agreement's primary target. It requires substantial but achievable transformation given favourable socioeconomic conditions. Carbon pricing reaches €100-200 per tonne by 2050. Renewable energy provides 60-80% of electricity by 2050. Electrification advances across transport and industry. International cooperation facilitates technology transfer and coordinated policy.
Critically, the sustainability narrative assumes public acceptance of change, enabling phased transitions rather than disruptive shocks. Companies have time to adapt, but the transformation remains fundamental—incremental change proves insufficient.
When to Use SSP1-2.6:
Socioeconomic Narrative:
SSP2 describes a world where historical trends continue with neither dramatic improvement nor catastrophic deterioration. Development proceeds unevenly—some countries make rapid progress whilst others lag behind. International cooperation remains partial and fragmented. Technological progress continues at moderate pace without breakthrough acceleration. Income inequality persists between and within nations. Environmental concerns receive attention but compete with other priorities.
Key Socioeconomic Characteristics:
Temperature Outcome: Approximately 2.7°C warming by 2100, potentially stabilising around 3°C.
Emissions Trajectory: Emissions peak around 2040-2050, then decline gradually. Some climate policies implemented globally but insufficient for 2°C target.
Radiative Forcing: Stabilises at approximately 4.5 W/m² by 2100.
Physical Climate Characteristics:
Business Implications:
SSP2-4.5 represents perhaps the most realistic baseline for current trajectories. It assumes meaningful but insufficient climate action—carbon pricing reaches €30-80 per tonne, renewable energy provides 40-60% of electricity by 2050, efficiency improvements occur incrementally, and policy implementation remains fragmented across jurisdictions.
The "middle road" narrative creates mixed business conditions: some regions and sectors transform rapidly whilst others lag. Supply chains span both progressive and conservative jurisdictions. Technology costs decline but not as rapidly as in SSP1. Physical climate impacts become material but remain within adaptation capacity for well-prepared organisations.
Critically, SSP2 describes moderate challenges for both mitigation and adaptation—neither easy nor impossible, but requiring sustained effort and investment.
When to Use SSP2-4.5:
Socioeconomic Narrative:
SSP3 describes an increasingly fragmented world with resurgent nationalism, regional conflicts, and weak international cooperation. Countries focus on national security and resource security at the expense of global coordination. International institutions weaken. Trade barriers increase. Technology development slows and diffusion across borders becomes limited. Economic growth stagnates in many regions. Population growth remains high, particularly in developing countries with low education levels. Environmental concerns receive low priority.
Key Socioeconomic Characteristics:
Temperature Outcome: Approximately 3.6°C warming by 2100, with continued warming beyond.
Emissions Trajectory: Emissions continue growing until approximately 2080, then decline slowly. Climate policies remain weak and fragmented.
Radiative Forcing: Reaches approximately 7.0 W/m² by 2100.
Physical Climate Characteristics:
Business Implications:
SSP3-7.0 represents the "forgotten worst case" for many businesses. Whilst physical climate impacts prove substantial, the socioeconomic context creates compounding risks that often exceed direct climate impacts:
The combination of moderate physical risks with very high socioeconomic risks creates unique strategic challenges. Companies with global operations face governance uncertainty, supply chain fragility, and market access barriers even in regions where climate impacts remain manageable.
When to Use SSP3-7.0:
Socioeconomic Narrative:
SSP5 describes a world pursuing rapid economic growth through intensive resource exploitation and fossil fuel use. Technological innovation accelerates but focuses on economic efficiency rather than environmental protection. International markets integrate effectively. Governance proves effective at enabling growth but weak on environmental protection. Population growth remains low due to high education and urbanisation. Material consumption and energy use per capita rise substantially. Trust in technological solutions dominates over fundamental system changes.
Key Socioeconomic Characteristics:
Temperature Outcome: Approximately 4.4°C warming by 2100, with continued warming beyond.
Emissions Trajectory: Continuous emissions growth through 2100, with CO₂ concentrations potentially exceeding 1,300 ppm.
Radiative Forcing: Reaches approximately 8.5 W/m² by 2100 and continues rising.
Physical Climate Characteristics:
Business Implications:
SSP5-8.5 combines extreme physical climate impacts with high socioeconomic capacity—at least initially. The narrative assumes sustained economic growth and technological development provide resources for adaptation. However, beyond mid-century, physical impacts overwhelm even substantial adaptive capacity.
Critical strategic considerations include:
Plausibility Assessment: Many climate scientists consider SSP5-8.5 increasingly unlikely given renewable energy cost reductions and policy momentum. However, it remains valuable for understanding extreme physical risk boundaries and testing resilience under tail-risk scenarios.
When to Use SSP5-8.5:
| Scenario | 2046-2065 Warming (°C) | 2081-2100 Warming (°C) | Physical Risks | Transition Risks | Socioeconomic Context |
|---|---|---|---|---|---|
| SSP1-1.9 | 1.3 | 1.4 | Very Low | Very High | Sustainability, cooperation |
| SSP1-2.6 | 1.5 | 1.8 | Low | High | Sustainability, cooperation |
| SSP2-4.5 | 1.8 | 2.7 | Medium | Medium | Middle road, moderate challenges |
| SSP3-7.0 | 1.9 | 3.6 | High | Low-Medium | Fragmentation, conflicts |
| SSP5-8.5 | 2.4 | 4.4 | Very High | Low (until ~2040) | Fossil development, high consumption |
Critical Planning Insight: Differences between scenarios remain modest through mid-century but become fundamental by 2050-2100. For assets with 30+ year lifespans, scenario selection directly affects viability assessments and adaptation investment requirements.
Relevant Sectors: Fossil fuel production and distribution, cement and steel manufacturing, chemicals, aviation, shipping, heavy industry.
Primary Scenario Focus: SSP1-2.6 plus SSP2-4.5
Carbon-intensive industries face asymmetric risk profiles where transition scenarios create existential threats. However, the socioeconomic context determines whether transformation proves feasible or disruptive.
Strategic Imperatives Under SSP1-2.6:
Strategic Imperatives Under SSP2-4.5:
Why SSP3-7.0 Matters:
Fragmented governance in SSP3 creates unique risks for carbon-intensive industries:
Case Example: A European cement manufacturer uses SSP1-2.6 to model optimal transition pathway (finding CCUS becomes cost-competitive by 2035 with policy support), SSP2-4.5 for baseline planning (moderate carbon pricing, slower CCUS deployment), and SSP3-7.0 to assess fragmentation risks (finding some markets remain accessible with high-carbon products whilst others impose prohibitive barriers, requiring bifurcated production strategies).
Relevant Sectors: Real estate and infrastructure, utilities and power generation, agriculture and food production, transportation and logistics.
Primary Scenario Focus: SSP2-4.5 (baseline) plus SSP3-7.0 or SSP5-8.5 (stress tests)
Industries with long-lived physical assets must evaluate climate impacts over multi-decade horizons whilst accounting for socioeconomic factors affecting adaptation capacity, insurance availability, and asset values.
Strategic Imperatives Under SSP5-8.5:
Strategic Imperatives Under SSP3-7.0:
Case Example: A US real estate investment trust analyzes coastal properties under SSP5-8.5 (finding substantial flood exposure by 2050 requiring €50M in protection measures or divestment), SSP3-7.0 (finding insurance availability collapses by 2040 even with moderate physical risk, forcing earlier action), and SSP1-2.6 (finding retrofit mandates require €80M by 2040 but green financing remains available). The scenarios reveal that assets face material risks under ALL pathways, but through different mechanisms requiring distinct strategies.
Relevant Sectors: Banking and lending, insurance and reinsurance, asset management, pension funds.
Primary Scenario Focus: Comprehensive multi-scenario portfolio (SSP1-2.6, SSP2-4.5, SSP3-7.0, SSP5-8.5)
Financial institutions face both direct operational risks and indirect risks through customers and portfolio holdings. The socioeconomic narratives directly affect creditworthiness, asset valuations, and investment returns.
Sector-Specific SSP Applications:
Banking and Credit Risk:
Insurance and Underwriting:
Asset Management:
Case Example: A European bank conducts integrated credit risk assessment. Under SSP1-2.6, ~15% of corporate loan portfolio faces transition-driven default probability increases (primarily in chemicals, steel, cement). Under SSP3-7.0, ~20% faces elevated risk from governance deterioration (particularly emerging market exposures and companies dependent on global supply chains). Under SSP5-8.5, ~8% faces physical risk-driven defaults (agricultural loans in water-stressed regions, commercial real estate in coastal zones). The scenarios inform sector-specific credit tightening, geographic exposure limits, and enhanced due diligence requirements varying by SSP dimensions.
Relevant Sectors: Agricultural production, food processing and distribution, agricultural inputs, food retail.
Primary Scenario Focus: SSP2-4.5, SSP3-7.0, SSP5-8.5
Agriculture faces perhaps the most comprehensive scenario impacts. Population growth drives demand. Climate change affects production. Trade policy affects distribution. Technology access affects adaptation capacity.
Socioeconomic Factors Dominate Risk Profile:
Under SSP1-2.6:
Under SSP2-4.5:
Under SSP3-7.0 (Critical Scenario for Food Systems):
Under SSP5-8.5:
Case Example: A global food processor maps supply chains across SSPs. Under SSP2-4.5, moderate adaptation (diversifying sourcing regions, investing in climate-resilient varieties) proves sufficient. Under SSP3-7.0, fragmented trade requires regionalised production and storage capacity to buffer supply disruptions—capital requirements triple versus baseline. Under SSP5-8.5, some current production regions become non-viable by 2060, requiring fundamental sourcing restructuring. The scenarios drive supplier diversification, increased inventories (costly but necessary in SSP3), and R&D investment in alternative ingredients.
Relevant Sectors: Software and digital services, professional services, technology hardware manufacturing, retail and e-commerce.
Primary Scenario Focus: SSP2-4.5 (baseline) plus focused analysis of specific vulnerabilities and opportunities
Technology sectors face primarily indirect climate risks but substantial opportunity variation across socioeconomic pathways.
Opportunity Profiles by SSP:
SSP1-2.6:
SSP2-4.5:
SSP3-7.0:
Workforce and Talent Considerations:
SSPs significantly affect technology sector workforce dynamics:
Case Example: A SaaS company develops climate risk analytics software. Under SSP1-2.6, market grows rapidly (15-20% CAGR) as companies globally invest in climate strategy. Under SSP2-4.5, growth remains solid (8-12% CAGR) but concentrated in regulated sectors and regions. Under SSP3-7.0, total addressable market fragments into regional platforms with limited interoperability—company must decide between global reach with high complexity or regional focus with lower complexity. The scenarios inform go-to-market strategy, product architecture decisions (multi-tenant global vs regional deployments), and M&A strategy (acquiring regional players to establish presence).
Over the next 5 years, physical climate differences between SSP scenarios remain modest. However, policy trajectories and market dynamics diverge substantially—and these socioeconomic factors drive near-term business impacts more directly than physical climate variables.
SSP Divergence Through 2030:
Practical Implications for Near-Term Planning:
Use SSP1-2.6 primarily to evaluate policies already enacted or highly probable (EU ETS Phase 5, US Inflation Reduction Act extensions, Carbon Border Adjustment Mechanism expansions). Physical risk analysis can use any reasonable baseline through 2030, as differences remain negligible. Focus analytical resources on understanding transition dynamics—policy evolution, market shifts, technology trajectories—rather than physical climate differentiation.
By mid-century, both physical and socioeconomic dimensions diverge substantially across SSPs. This period represents the strategic sweet spot for scenario analysis—far enough that scenarios differ meaningfully, near enough that current decisions materially affect outcomes.
Physical Divergence:
Socioeconomic Divergence:
Recommended Approach:
Use comprehensive multi-scenario portfolio to bound plausible outcomes. Identify "no-regret" investments delivering value across all scenarios. Develop contingent strategies triggered by observable indicators showing which pathway is unfolding. The 2030-2050 window justifies serious analytical investment—scenarios diverge enough to matter whilst remaining near enough that organisations can influence outcomes through decisions made today.
Beyond mid-century, scenarios diverge so dramatically that traditional planning approaches face fundamental limitations. SSP1-2.6 produces stabilised, manageable climate. SSP5-8.5 produces severe disruption. SSP3-7.0 combines moderate climate change with governance breakdown.
Planning Challenges:
Recommended Approach for Long-Term Commitments:
For organisations with truly long-term commitments (pension funds, sovereign wealth funds, nuclear facilities, major infrastructure with 75+ year lifespans), shift focus from prediction to resilience. Ask: "What conditions would make our strategy unviable?" rather than "Which scenario is most likely?"
Test against boundary scenarios—SSP5-8.5 for extreme physical impacts, SSP3-7.0 for governance breakdown, SSP1-2.6 for aggressive transition. Build adaptive capacity and strategic flexibility rather than optimising for specific outcomes. At multi-generational time scales, robustness across wide ranges of futures matters more than selecting "correct" scenarios.
Question 1: What's your primary climate risk category?
Question 2: How dependent are you on specific socioeconomic conditions?
Question 3: What's your relevant time horizon?
Question 4: What's your geographic exposure?
CSRD (EU Companies): European Sustainability Reporting Standards require scenario analysis demonstrating strategy resilience. At minimum:
Best practice: Use SSP1-2.6 for Paris alignment plus SSP2-4.5 baseline and either SSP3-7.0 (governance risks) or SSP5-8.5 (physical risks) depending on exposure profile.
ISSB Standards (Global): IFRS S2 Climate-related Disclosures require:
California Climate Disclosure Laws (US Companies): SB 261 requires climate-related financial risk disclosure referencing scenario analysis. Practical compliance: SSP1-2.6, SSP2-4.5, and optionally SSP5-8.5 or SSP3-7.0 depending on risk profile.
Standard Recommendation for Most Companies:
Primary Portfolio:
Alternative Portfolios by Risk Profile:
Carbon-Intensive Industries:
Physical Asset-Heavy Industries:
Global Supply Chain-Dependent:
Financial Services:
Your disclosure should clearly articulate:
Socioeconomic Narrative Communication:
When using SSPs, explicitly reference the socioeconomic dimensions where they affect your analysis:
"Under SSP3-7.0, we assessed combined risks from moderate physical climate impacts (3.6°C warming) and governance fragmentation. The scenario assumes weak international cooperation, reduced technology transfer, and protectionist trade policies. For our operations across 15 countries, these socioeconomic factors create supply chain risks and regulatory complexity that compound physical climate impacts. This scenario drove our decision to regionalise production capacity and increase inventory buffers."
This level of specificity demonstrates genuine analytical rigour whilst helping stakeholders understand how socioeconomic context shapes your risk assessment.
The Problem: Companies use SSP1-2.6, SSP2-4.5, and SSP5-8.5 but ignore the socioeconomic narratives, treating them simply as updated RCPs.
Why It's Wrong: This approach misses the primary value addition of SSPs. The socioeconomic dimensions—population trends, governance effectiveness, technology development, trade patterns—often drive business risks more directly than physical climate variables, particularly over 10-30 year horizons.
Correction: Explicitly incorporate socioeconomic assumptions into your analysis. When evaluating SSP3-7.0, assess both the 3.6°C warming AND the implications of fragmented governance, high population growth, limited technology transfer, and protectionist trade. Document how these socioeconomic factors affect your risk assessment and strategic response.
The Problem: Companies default to SSP1-2.6, SSP2-4.5, and SSP5-8.5, viewing SSP3-7.0 as unnecessary "middle ground" between SSP2 and SSP5.
Why It's Wrong: SSP3-7.0 doesn't represent a middle ground—it represents a fundamentally different risk profile. The combination of moderate physical impacts with governance breakdown, fragmented markets, and limited adaptation capacity creates unique strategic challenges often more severe than higher-emission scenarios with stronger institutions.
Correction: For companies with global supply chains, emerging market exposure, or dependency on international cooperation, SSP3-7.0 often proves more strategically relevant than SSP5-8.5. Evaluate whether governance and socioeconomic risks dominate your exposure profile. If so, prioritise SSP3-7.0 in your scenario portfolio.
The Problem: Despite the evolution to SSPs, companies still default to SSP5-8.5 as baseline "no action" scenario.
Why It's Wrong: SSP5-8.5 describes not just high emissions but a specific socioeconomic pathway—rapid economic growth, fossil fuel dependence, high consumption. Current trends don't align with this narrative. Renewable energy economics, policy momentum, and demographic trends more closely resemble SSP2-4.5.
Correction: Use SSP5-8.5 explicitly as extreme physical risk stress test, not baseline planning scenario. For "realistic baseline," use SSP2-4.5. Communicate SSP5-8.5 as "high-impact, decreasing-probability" boundary testing rather than "business-as-usual."
The Problem: Single-scenario analysis creates false precision, suggesting predictability where genuine uncertainty exists.
Why It's Wrong: Both climate and socioeconomic futures remain deeply uncertain over multi-decade horizons. Population growth, governance evolution, technology trajectories, and international cooperation could follow multiple plausible pathways. Single-scenario planning produces strategies optimised for one future whilst potentially fragile to others.
Correction: Always use at least two scenarios, preferably three. Common combinations: (1) SSP1-2.6 + SSP2-4.5 + SSP5-8.5 for broad coverage, (2) SSP1-2.6 + SSP2-4.5 + SSP3-7.0 for transition-focused companies with governance exposure, or (3) SSP2-4.5 + SSP3-7.0 + SSP5-8.5 for physical-risk-focused companies.
The Problem: Scenario analysis produces comprehensive reports without informing actual decisions. Analysis becomes compliance exercise rather than strategic input.
Why It's Wrong: SSP scenario analysis requires substantial investment in data, modelling, and management time. If it doesn't influence capital allocation, facility siting, supplier selection, technology roadmaps, or market strategy, it creates process burden without value.
Correction: Explicitly document strategic decisions informed by scenarios. Examples:
Q: Should I use RCP or SSP scenarios for business planning in 2026?
Use SSP scenarios. They represent the current scientific standard (IPCC AR6) and provide richer strategic context through integrated socioeconomic narratives. SSP1-2.6, SSP2-4.5, and SSP5-8.5 offer the same physical climate projections as their RCP counterparts (2.6, 4.5, 8.5 W/m² forcing) whilst adding critical information about population trends, governance effectiveness, technology development, and market evolution. These socioeconomic factors directly affect business strategy in ways that pure climate projections cannot capture.
RCPs remain acceptable if data availability or analytical capacity limits your scope, but SSPs represent best practice for comprehensive climate risk assessment in 2026.
Q: Do I need to analyze all five SSP narratives?
No. Most companies benefit from analysing 2-3 SSP scenarios selected based on risk profile. Common portfolios:
SSP1-1.9 typically remains optional except for companies pursuing 1.5°C alignment or Article 9 sustainable finance classification. Justify scenario exclusions based on materiality assessment rather than attempting comprehensive coverage.
Q: How do I communicate the socioeconomic dimensions of SSPs to stakeholders?
Focus on business-relevant implications rather than academic descriptions. Examples:
Poor communication: "We used SSP3-7.0, which assumes high challenges to mitigation and adaptation."
Better communication: "We assessed SSP3-7.0, a scenario combining moderate climate change (3.6°C warming) with fragmented international cooperation, protectionist trade policies, and limited technology transfer. For our multi-jurisdictional operations and global supply chains, this scenario creates compounding risks: physical climate impacts in vulnerable production regions, regulatory fragmentation increasing compliance costs, and trade barriers disrupting logistics networks."
Connect socioeconomic assumptions to specific business implications. This demonstrates analytical rigour whilst helping stakeholders understand how narratives shape your risk assessment.
Q: What if stakeholders or regulators still reference RCPs?
Many stakeholders remain more familiar with RCP terminology. Bridge the communication gap by referencing both frameworks where helpful:
"We conducted scenario analysis using SSP1-2.6, SSP2-4.5, and SSP5-8.5 from the IPCC's Sixth Assessment Report. These scenarios provide the same physical climate projections as the previously used RCP 2.6, 4.5, and 8.5 pathways, whilst incorporating socioeconomic narratives that inform our assessment of transition feasibility and adaptation capacity."
This approach acknowledges familiarity with RCPs whilst explaining the added value of SSP framework.
Q: How often should I update my SSP scenario analysis?
Formal updates should occur every 2-3 years or when material changes occur:
Between formal updates, monitor key indicators:
If indicators suggest substantial divergence from your baseline assumptions, conduct interim qualitative review to determine whether earlier formal refresh is warranted.
Q: Can I use simplified SSP analysis if resources are constrained?
Yes. Better to conduct focused SSP analysis than abandon scenario planning due to resource constraints. Simplified approach:
Focused, transparent analysis proves more valuable than attempting comprehensive coverage without adequate resources. Many companies successfully begin with simplified approaches, then expand scope over 2-3 year improvement cycles.
Selecting appropriate SSP scenarios represents the foundation of climate risk analysis, not its conclusion. The scenarios you choose shape every subsequent analytical step—physical risk quantification, transition pathway modelling, socioeconomic impact assessment, and strategic response development.
Embrace the socioeconomic dimensions. SSPs aren't just updated RCPs—they provide strategic context about population, governance, technology, and markets that directly affects your business. Companies that focus purely on physical climate projections whilst ignoring socioeconomic narratives miss the primary value of the SSP framework.
Don't overlook SSP3-7.0. Many companies default to SSP1-2.6, SSP2-4.5, and SSP5-8.5, viewing SSP3 as unnecessary middle ground. However, the fragmentation narrative often creates more severe business impacts than higher-emission scenarios. For companies with global operations, emerging market exposure, or complex supply chains, SSP3-7.0 deserves serious analytical attention.
Avoid analysis paralysis. Perfect scenario selection matters less than conducting credible analysis with justified choices. Companies that spend years debating nuances whilst taking no action face greater risk than those that select reasonable scenarios, conduct transparent analysis, and iterate as understanding improves.
Connect scenarios to decisions. The best scenario portfolio means nothing if analysis doesn't inform capital allocation, facility planning, supplier management, or innovation priorities. Integrate SSP scenarios into existing planning processes rather than treating them as standalone compliance exercises. Document specific strategic decisions informed by scenarios to demonstrate genuine analytical rigour.
Plan for iteration. First SSP scenario analyses will be imperfect. Data limitations, methodological uncertainties, and resource constraints affect initial efforts. Accept this reality whilst committing to systematic improvement. Many organisations successfully employ 2-3 year improvement cycles: initial assessment establishes baseline, subsequent iterations refine methods and expand scope based on lessons learned.
For organisations seeking expert support in translating SSP scenario selection into comprehensive climate risk strategies, Fiegenbaum Solutions provides customised guidance aligned with your specific industry exposure, geographic concentration, socioeconomic dependencies, and strategic priorities. Our approach ensures scenario analysis drives genuine value whilst meeting CSRD, ISSB, and investor expectations. Contact us to develop an SSP scenario framework tailored to your business.
For comprehensive guidance on implementing your selected SSP scenarios within a complete climate risk framework, explore our essential climate scenarios series.
Need expert guidance on selecting and implementing the right SSP scenarios for your business? Fiegenbaum Solutions combines over 15 years of sustainability expertise with deep understanding of CSRD, ISSB, and climate risk requirements. Get in touch to develop a tailored SSP scenario framework that drives strategic value whilst ensuring regulatory compliance.