Written by: Heidi Bush, CFA, Craig Metrick, CAIA and Jennifer Leonard, CFA
A growing global population and economy leads to more demand for food, water, transportation, housing and the fuel to supply these essentials to the world’s populace. Growing food, providing transportation and supplying the energy to foster global commerce all lead to greenhouse gas (GHG) emissions. Rising GHG emissions are the root cause of climate change.
Warming temperatures put our agriculture, health and water supply at risk. Warmer oceans and higher seas lead to stronger hurricanes and storm activity, causing flooding, coastal erosion and crop damage.
As outlined in our report No Place to Hide? Climate Change and Systemic Financial Risk, without urgent investment to scale climate solutions, global financial assets face value destruction of 2-17% depending on the pace and intensity of further global warming. If the more extreme scenarios come to pass, entire portfolios would be affected as key sectors of the economy face severe losses.
In this report, we propose ways for investors seeking to fight climate change to deploy capital in support of SDG 13: Climate Action. To do so, we use Cornerstone’s Access Impact FrameworkTM, which identifies relevant “access themes” that offer tangible investment ideas and helps to measure the impact of those investments.
Investment opportunities include funds that support new clean, alternative energy technologies, better farming methods, electric vehicle transportation and other growth industries which can help curb greenhouse gas emissions and slow the pace of warming. These investments target market rate or better returns while offering solutions to restrain global warming and its negative global impacts.
Download Scaling Climate Action.
Related: Sacrifice Nothing: A Fresh Look At Investment Performance Of Sustainable And Impact Strategies By Asset Class