Preparing investors for the Inevitable Policy Response to climate change

Markets today have not adequately priced in the likely near term policy response to climate change.

This leaves portfolios exposed to significant risk and investors need to act now to protect and enhance value. That’s why PRI have launched this project, to provide investors with a realistic forecasting tool to help navigate this complex and evolving landscape.

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Find out how we can help you navigate climate risk

“This is a flagship project for the PRI, I urge all signatories to assess the implications of the Inevitable Policy Response for their portfolios and act now to protect and enhance value”
- Fiona Reynolds, CEO, PRI

What is the Inevitable Policy Response?

Financial markets today have not adequately priced-in the likely near-term policy response to climate change. The Inevitable Policy Response (IPR) is a pioneering project which aims to prepare investors for the associated portfolio risks.

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Implications for strategic asset allocation

New analysis in this report forecasts an abrupt and disruptive policy response to climate change which will cause re-pricing of many of the world’s most valuable companies by 2025.

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Forecast Policy Scenario: macroeconomic results

The Forecast Policy Scenario (FPS), introduced in this report, models the impact of the forecasted policies on the real economy up to 2050, tracing detailed effects on all emitting sectors, including changes to energy demand (oil, gas, coal), transport, food prices, crop yields, and rates of deforestation.

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Pathways to net zero: scenario architecture for strategic resilience testing and planning

Climate change poses a systemic risk to institutional investors. All portfolios are exposed to it, yet the impacts will be uneven across asset classes, sectors and geographies.

Trillion Dollar Energy Windfall Cover

The trillion dollar energy windfall

Falling renewable electricity costs play an important part of “why” a policy response is likely to occur. And the arrival at new tipping points within sectors and countries over the next decade informs “when” this response is likely to materialise.

Just transition cover

Why a just transition is crucial for effective climate action

The concept of a just transition has emerged as a key pillar of climate strategy; it is crucial to understanding ‘where’ the impact of policies will be felt and ‘what’ policies will be used.


Business and investor public support for Climate Transition Policy: creating a mandate for action

Business and investor support for action play an important part of “why” this policy response is likely to emerge over the next 6 years. These give an economic and market mandate to policy makers for action.

To better understand how the Inevitable Policy Response could be of use to your and your investment team, please get in touch.
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