Climate Under the Magnifying Glass

    NordSIP (Stockholm) – UBS Asset Management published a short report titled “A Climate Primer”, aiming to provide investors with an overview of the climate change debate, highlighting key drivers from an investment perspective and discussing examples of the ways in which investors can start to think about climate change and develop investment approaches.

    According to the report, regulation is one of the main drivers of sustainable investment, with an increasing amount of legislation, be it in France or California, requiring disclosure of information about investors’ exposure to climate risks. The reason there is such urgency around climate regulation is the danger that if CO2 emissions continue to grow temperatures are expected to rise between 3 degrees and 4 degrees.

    To navigate this new and complex investment environment UBS recommends the use of climate change scenario analysis “as a means of understanding how climate changes can drive financial impact across their portfolios”. A framework for doing so can be found in the 2018 paper titled “Navigating climate scenario analysis” by the Institutional Investors’ Group on Climate Change (IIGCC), of which UBS is a member.

    For more details, please click here to read the full report.
    Picture from Pixabay
    Filipe Albuquerque
    Filipe Albuquerque
    Filipe is an economist with 8 years of experience in macroeconomic and financial analysis for the Economist Intelligence Unit, the UN World Institute for Development Economic Research, the Stockholm School of Economics and the School of Oriental and African Studies. Filipe holds a MSc in European Political Economy from the LSE and a MSc in Economics from the University of London, where he currently is a PhD candidate.

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