A great number of investors perceive climate change as a material risk. Thus, it progressively manipulates their investment activities, said in a report by a coalition of global investor groups as reported by Bloomberg.
The coalition of global investors includes the Asia Investor Group on Climate Change, the Australia/New Zealand Investor Group on Climate Change, the European Institutional Investors Group on Climate Change, and the North American Investor Network on Climate Risk.
In 2012, 50 percent of asset managers and 25 percent of asset owners stated that they factor in climate change issues during investment or divestment conclusions.
Chris Davis, director of investor programs at Ceres told Bloomberg, “We are pleased that global investors are continuing to prioritize climate change as a material investment risk and source of investment opportunity. But much work remains to be done, especially in the U.S., to fully integrate climate risk into investment decision-making, and to advance public policies that will accelerate more low carbon investment.”
Regulatory changes associated to government support schemes, greenhouse gas emissions, physical impacts, and corporate governance policies for climate change are amid the top climate risk factors classified by asset managers and owners.
The reports said that climate risks are most likely to be scrutinized for particular investments and within asset classes, that at the portfolio level. It also said that assessments for real estate and infrastructures are focus on the possible physical impacts of climate change and/or carbon emissions of specific assets.
Despite the efforts of various business groups, there is still a lot of analysis to do on the corporate level and public policy to deal with challenges for investors, like lack of clarity on which investments should be deliberated and “patchy carbon signals”, stated in the report.
Furthermore, the survey showed that the greater number of public policy engagements persist to be from the Global Investor Coalition on Climate Change, which embodies the International Investment Community to policy makers.
