Climate change analysis in the investment process

This report aims to help improve knowledge and understanding about how climate risk can be applied to financial analysis and portfolio management. It then informs practitioners how best to incorporate these analyses into their investment processes, based on case studies of firms that are currently integrating climate-related analysis into their investment models.

As the earth’s atmosphere warms and the side effects of climate change become more prevalent, more pressure will be placed on everyone, including financial professionals, to take actions that address climate change. To do this important work, financial professionals need a few key tools.

• A price on carbon
• Carbon price expectations included in analyst report
• Increased transparency and disclosure on climate metric
• Engagement with companies on physical and transition risks of climate change
• Education within our profession
• Policy that complements our efforts