The British Columbia Investment Management Corp. is partnering with the University of Victoria-led Pacific Institute for Climate Solutions to co-develop decision-making tools and frameworks for integrating climate change risk evaluation and climate mitigation opportunities into investment portfolios.
“Acting in the best financial interests of our clients requires us to think long-term about the opportunities and risks presented by climate change,” said Stefan Dunatov, executive vice-president of investment strategy and risk at the BCI, in a press release.
Over the course of three years, the $180,000 research project will leverage and build on the BCI’s existing climate-change scenario risk analysis and valuation framework, incorporating the best available academic and applied research. The project’s team will also evaluate global government stimulus and green recovery packages in response to the coronavirus pandemic, as well as potential implications for investment management approaches supporting the transition toward a net-zero future.
In the release, Michael King, Lansdowne chair in finance at the University of Victoria and a co-investigator on the project, said large asset owners, such as pension funds, play a critical role in supporting the transition to a net-zero emissions future via portfolio choices and investment activities. But he also said there are obstacles to overcome.
“Barriers to unlocking this potential include a lack of access to expertise, data and research as well as tools for integrating climate change modelling into investment decisions. This project will help address these gaps for a broad range of stakeholders including the business sector, educators and policymakers.”