Global Investor Groups Publish Guidance on Investing in Solutions to Address Climate Change

The four investor groups on climate change have today published a guide outlining a range of strategies and solutions investors can use to address climate change, including low carbon investment, managing and reducing carbon exposure in portfolios, and engagement, as investors around the world work to scale up their efforts to invest in clean energy and shift to lower carbon assets.

The investment solutions guide follows last year’s Financial Institutions Taking Action on Climate Change report, which concluded that there is a need for actions addressing climate change to be more widely integrated into mainstream investment processes.

A joint project of IIGCC in Europe, Ceres’ Investor Network on Climate Risk (INCR) in North America, IGCC in Australia/New Zealand and ASrIA’s Asia Investor Group on Climate Change (AIGCC) in Asia, Climate Change Investment Solutions focuses on four areas:

• Strategic review – actions to integrate climate change into investment beliefs and investment policies.
• Strategic asset allocation – actions for measuring and managing the risks and opportunities of climate change within existing asset allocation and through evolving asset allocation over time.
• Mitigation investment actions – actions for reducing the carbon intensity of existing assets, along with opportunities to invest in low carbon, clean energy and energy efficient assets.
• Adaptation investment actions – actions to reduce the vulnerability of existing assets to the physical impacts of climate change as well as building exposure to adaptation solutions.

Actions taken by investors will be central to tackling climate change and shifting the world to a low carbon economy.  This guide suggests practical steps investors can take to protect their portfolios from the risks of climate change and seize opportunities arising during the transition to a low carbon economy.

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