Climate change:
The investment risks and opportunities


A practical guide to managing climate change risk for sovereign investors and central banks.

The fiduciary duty of official institutions, such as central banks, sovereign wealth funds and state pension funds, means the risks posed by climate change need to be carefully weighed, and then addressed with capital allocation and engagement. 

But by divesting from fossil fuels – reducing exposure to a significant income paying sector of global markets – are institutions failing their fiduciary duty? To what extent should institutions engage with the companies they invest in and potentially vote in favour of shareholder resolutions?

This short guide unpicks some of the misconceptions around climate change risk and provides practical advice for institutions to stay on the right side of their fiduciary duty.

Click to read the report

What's inside?

  • Why should sovereign investors and central banks be concerned about climate change?
  • Implications for investments
  • What risks and opportunities are there from climate change?
  • Practical actions to reduce exposure to climate change risk
  • An action plan for sovereign investors and central banks

How we can help

We help central banks design and implement investment strategies to get the most out of their reserves in a risk-controlled manner. 

The LCP Wealth Drawdown tool is designed to help advisers explore the impact of charges and other factors on your pension in drawdown.

Setting a good investment strategy and picking the right funds is fundamental for wealth managers and advisers to be able to deliver better outcomes for their clients. Our role is to advise clients on investment strategy and fund manager selection bringing institutional discipline to the retail market.

Every sovereign wealth fund has its own unique circumstances and challenges. As an independent consultancy, we’re not linked to any asset manager and we don’t sell investment products.

We help our clients understand and implement responsible investment principles.