Decarbonizing Long-term Portfolios

Abstract

Climate change is altering the dynamics of investing by posing meaningful risk while also offering substantial new opportunities for growth and investment. An adaptable, top-down approach to decarbonization provides long-term investors with multiple levers for addressing climate risk inside their investment portfolios while fulfilling their mandates and capitalizing on new opportunities. In this report, we offer resources to guide investors in applying the appropriate combination of top-down decarbonization strategies across their portfolios while integrating decarbonization objectives into investment beliefs, risk appetite statements, and investment mandates.

Keywords: climate change, long term portfolios, net zero, investment portfolios, decarbonization, decarbonisation

JEL Classification: D03, G02, G12, G23