The purpose of this thesis is to explore how the unpredictability of climate change and natural disasters impact the risk perception of Swedish companies. The literature chapter that has been elaborated in this study describes theories that are associated with effects of climate change and natural disasters, risk management and knowledge. Further on, the research has been conducted with a qualitative method in order to gain a profounder understanding of the topic and how it influences the risk perception of Swedish companies. The study has further on been following a abductive research approach since the area of research was rather unexplored.  We present the results of our study by answering to the research questions in the conclusion chapter that have been derived from the analysis. Furthermore, the conclusion chapter involves that the risks perception of the studied companies differentiates depending on the level and type on knowledge that the companies hold.

The internationalization of small and medium sized enterprises (SMEs) has become a major worldwide trend. Firms internationalize predominantly to in nearby countries due to the fact that these countries are closer culturally and geographically. However, SMEs has started to enter more cultural and geographical distant markets. Emerging markets has been the focus of attention of Swedish SMEs during the last decades. Of those emerging markets India is one example of a foreign market that has experienced, to a large extent, the establishment of foreign companies in the past half a century. In the last decades India has undergone a remarkable change that has strengthened the establishment of foreign companies in the country. However, SMEs face risk and uncertainties when entering a new market like India. Therefore, companies need to acquire enough relevant knowledge about the country in order to identify and manage to potential risks that the might encounter. Although knowledge and risk management have extensively been studied, scholars have primarily studied them separately. Little attention has been given to the fact that the combination of knowledge and risk management might be the better solution to identify and manage risks in foreign countries. By analyzing the implementation of knowledge and risk management, it was possible to answer if through their utilization SMEs get a better understanding and be competitive in the Indian market. In order to conduct the study a qualitative case study to four Swedish SMEs was conducted. The collected data and the most significant theories chosen in this study are the starting point of the analysis. The main conclusion that can be drawn from the analysis is that, although knowledge and risk management are not SMEs main focus of attention, the combined utilization of them is beneficial for firms in foreign markets. Firms that better understand the foreign market and its risks are in a better position to be more competitive in that foreign market.