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COP26 and Climate Change Considerations

Climate Economics and Climate Commitments

The COP26 conference on climate change is ongoing in Glasgow, Scotland, and concludes on November 12th. Here, we present recent investment content on climate change, including an explanation of climate change economics. 

Additionally, in their Net Zero Atlas, FTSE Russell calculates the applied temperature increase that is associated with the commitments that G20 countries have undertaken on climate change.

COP26 Glasgow

Greening the Real Economy: A perspective on COP26 (Impax Asset Management, 2021)

Global emissions have to be brought down to net zero by 2050. But what exactly is required in order to advance towards this net zero economy?

The Economics of Climate Change (Dimensional Fund Advisors, 2020)

Dimensional Fund Advisors reviews the evolution of greenhouse gas emissions and the basics of climate science before examining the direct and indirect costs of climate change.

Without a Plan, the Climate Moonshot Will Fail (Aviva Investors, Oct 2021)

For compliance reasons, this paper is only accessible in certain geographies

Aviva suggests that the OECD should become host to an International Platform for Climate Finance to assist countries in delivering on climate commitments.

Vive la Paris: Equity investing with the Paris Agreement (BlackRock, 2021)

For compliance reasons, this paper is only accessible in the United States and Canada

The Paris Agreement recognises that not only do governments play an important role, but achieving net zero by 2050 requires the investment community (both asset owners and asset managers) to allocate capital towards technologies, companies or countries that are fundamental for the energy transition. In this paper, BlackRock shows how to build a Paris-aligned equity strategy and how that can form part of a broader multi-asset portfolio that also seeks to align with the Paris requirements.

S&P Global Clean Energy Index (S&P Dow Jones Indices, Oct 2021)

S&P Dow Jones Indices introduces their Clean Energy Index and the Clean Energy Select Index in this brief article.

Can You Make Low Vol and Low Carbon Investing Compatible? (Intech, 2021)

For compliance reasons, this paper is only accessible in certain geographies

How can investors pursue volatility reduction and low carbon intensity investments simultaneously, when some of the most defensive stocks are also high carbon emitters?

Can Systematic Investors Plead the Fifth on RI? (Man Group, 2021)

Can a framework be designed for machines to invest responsibly, while avoiding accusations of greenwashing? Man Group looks at how systematic managers may be able to integrate ESG into their investment processes.

COP26 Net Zero Atlas (FTSE Russell, Nov 2021)

FTSE Russell evaluates the climate-oriented commitments of G20 countries and calculates an implied temperature rise associated with these commitments.