Investors are faced with both physical and transition risks as a result of climate change, with both of these affecting the value of investments. Acute and chronic risks are divided into acute and chronic risks, with acute risks referring to the challenges faced by companies and society due to climate change, such as unexpected damage caused by extreme weather events or the depletion of natural resources, while transition risks are related to changes in regulation, technology, and consumer behaviour resulting from a transition to a lower-carbon economy.