BlackRock - Smart Energy Decisions

Distributed Energy Resources, Energy Efficiency, GHG Emissions, Regulation, Distributed Generation, Finance, Regulation  -  September 7, 2016

BlackRock issues climate change warning to investors

On the heels of the U.S. and China formally joining the Paris Agreement on climate change, BlackRock on Sept. 6 urged investors to factor climate change into their portfolios or face potential financial losses. 

In a 16-page report, the world's largest asset manager outlined strategies for investors that will help adapt their portfolios to risk and opportunities presented by regulations and changing market dynamics related to climate change, regardless of personal beliefs on the topic. 

"Investors can no longer ignore climate change. Some may question the science, but all are faced with a swelling tide of climate-related regulations and technological disruption," BlackRock said in issuing its report. "We show how to mitigate climate risks, exploit opportunities or have a positive impact." 

Through the report, BlackRock categorizes risks and opportunities related to climate change in four buckets: physical, meaning more frequent and severe weather events;  technological, related to advances in batteries, electric vehicles or energy efficiency; regulatory, pertaining to subsidies, taxes and energy efficiency rules, and; social, recognized as changing consumer and corporate preferences.

"We show how all asset owners can — and should — take advantage of a growing array of climate-related investment tools and strategies to manage risk, search for excess returns or improve their market exposure," BlackRock said. 

U.S. President Barack Obama on Sept. 3 announced that the U.S. and China formally signed on to the climate change agreement first reached by 195 countries within the United Nations Framework Convention on Climate Change in Paris in late 2015. 

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