Integrating Loss and Damage into Climate Risk Assessment Frameworks: Evidence, Methodological Gaps, and a Pathway for Pacific Small Island Developing States

limate risk assessments (CRAs) are increasingly used to inform adaptation planning, climate finance, and development decisions. However, existing CRA frameworks vary widely in how they define risk, operationalise assessment methods, and account for adaptation limits and loss and damage. This working paper reviews major global, regional, national, and multilateral CRA frameworks through the lens of Small Island Developing States (SIDS), with a particular focus on their suitability for identifying residual risks, adaptation limits, and economic and non-economic loss and damage.

The paper compares selected frameworks, including ISO 14091, the GIZ Climate Risk Management framework, the EU Climate Risk Assessment Manual, the CLIMAAX framework, the Asian Development Bank’s Climate Risk Management Framework, and national applications in Pacific SIDS - against a common set of criteria. These include alignment with the IPCC AR6 risk framing; treatment of hazards, exposure, and vulnerability; methodological approaches; integration of loss and damage; use of disaggregated data; and relevance for climate finance and policy. It finds that while most frameworks align with the IPCC AR6 risk concept and robustly assess climate risks, few explicitly address adaptation limits or systematically integrate loss and damage, particularly non-economic losses. Where loss and damage is considered, it is typically confined to post-disaster accounting or implicitly embedded within damage estimates, without clear identification of residual risk or intolerable impacts. Thresholds for intolerable risk, mechanisms for distinguishing avoidable from unavoidable impacts, and methods for incorporating community-defined risk tolerance remain largely absent.

Building on this analysis, the paper identifies practical entry points for integrating loss and damage into existing CRA processes and highlights key methodological and institutional gaps relevant for SIDS. The findings directly inform the design of the Building Our Pacific Response to Loss and Damage (BOLD) initiative by supporting the development of context-appropriate, policy-relevant tools for assessing climate risks and unavoidable losses, strengthening national decision-making, and improving access to loss and damage finance.