The Importance of Climate Risks for Institutional Investors
83 Pages Posted: 27 Aug 2018 Last revised: 29 Jun 2019
Date Written: June 5, 2019
According to our survey regarding climate-risk perceptions, institutional investors believe these risks have financial implications for their portfolio firms and that the risks have already begun to materialize, particularly regulatory risks. Many of the investors, especially the long-term, larger and ESG-oriented ones, consider risk management and engagement, rather than divestment, to be the better approach for addressing climate risks. Although the investors believe that some equity valuations do not fully reflect climate risks, their perceived overvaluations are not large.
Keywords: Climate Risks, ESG, Institutional Investors
JEL Classification: G11, G3, Q54
Suggested Citation: Suggested Citation