Climate risks: a variable to consider for better financial decisions

17 May 2024 by National Bank Investments
Iceberg floating on the sea

How can we try to assess the impact of the energy transition and weather phenomena on markets? National Bank Investments is now incorporating climate risks into its long-term income projections and portfolio manager selection process. Our most recent white paper breaks down how.

Iceberg s floating on the sea

The economic context and climate risks

Systemic risk – the possibility of an event triggering severe economic instability – has been a widespread concern in the financial sector, particularly since the 2008 financial crisis. More recently, climate risks have been added to the list of factors that could disrupt the market.

Through their impact on economic activity, climate risks necessarily affect financial markets and, ultimately, return on assets. It’s therefore important for investment firms to integrate these risks into their decision-making process.

One vision, two measures

As an asset manager, NBI has put a plan in place to address climate risks. This plan is based on two strategies, detailed in this white paper.

  • To this day, few firms have integrated the notion of climate risk into portfolio construction. Find out how NBI's CIO Office achieved this and what conclusions can be drawn for return forecast.
  • NBI's open architecture model requires ongoing assessment and monitoring of portfolio managers, including their level of preparedness for climate risk. Learn how NBI evaluates its partners on this aspect.

Legal notes

The information and the data supplied in the present document, including those supplied by third parties, are considered accurate at the time of their printing and were obtained from sources which we considered reliable. We reserve the right to modify them without advance notice. This information and data are supplied as informative content only. No representation or guarantee, explicit or implicit, is made as for the exactness, the quality and the complete character of this information and these data. The opinions expressed are not to be construed as solicitation or offer to buy or sell shares mentioned herein and should not be considered as recommendations.

© National Bank Investments Inc., 2024. All rights reserved. Any reproduction, in whole or
in part, is strictly prohibited without the prior written consent of National Bank Investments Inc.

® NATIONAL BANK INVESTMENTS is a registered trademark of National Bank of Canada, used under licence by National Bank Investments Inc.

National Bank Investments is a signatory of the United Nations-supported Principles for
Responsible Investment, a member of Canada’s Responsible Investment Association, and a founding participant in the Climate Engagement Canada initiative.