Transition risk affects organizations as societies adapt climate policies, clean technologies emerge, investor preferences shift, and consumer behavior changes to address climate change. Carbon-intensive industries face stranded assets, regulatory costs, and declining demand for fossil fuel products. An automaker investing heavily in internal combustion engines faces transition risk as countries announce bans on new gasoline vehicle sales and competitors lead in electric vehicle technology. Managing transition risk requires scenario analysis under different climate policy pathways, strategic planning for business model adaptation, capital reallocation, and transparent disclosure of climate-related financial risks following frameworks like TCFD.