Climate scenario analysis is an essential activity for climate-driven asset managers.
It is vital that investors understand how physical climate change and the energy transition affect the investment returns of the companies and markets they invest in. We believe that doing so will enable us to build more resilient portfolios and generate better long-term returns for clients. It is also increasingly demanded by asset owners and regulators. Three features jointly differentiate abrdn's climate scenario framework from that of most other asset managers and allow us to fully integrate the results into our business strategy – bespoke scenario design, macro and micro integration, and probabilistic assessments.
A rigorous framework for managing climate financial risks and opportunities
Climate Scenario Analysis has been the focus of the second in our series of Climate Action Events. In this session, Jeremy Lawson, Chief Economist and head of the abrdn ResearchInstitute, leads a discussion on our cutting-edge climate scenario analysis framework. The panel highlights how the framework can be applied to better identify climate-related investment risks and opportunities. We believe it is possible to build low-carbon portfolios that closely match benchmarks. Our research shows that portfolios with a climate tilt can deliver similar or better performance in most regions and under most scenarious.