PARTNER INSIGHT: LGIM's Omi and Kilpatrick: How we capture value through a 'climate tilt'

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According to a recent survey by market research firm East & Partners, 97% of investment managers are ready to increase capital allocations in low-carbon technology or other assets that stand to benefit from climate policies.

Legal and General Investment Management (LGIM) is one fund manager already meetig clients' goals with this thematic: "We take our responsibility to act as good stewards and influence change seriously, devoting significant resources to this effort," says Meryam Omi, Head of Sustainability and Responsible Investing Strategy.

"Investors are increasingly realising the need to address the long-term financial risks and opportunities associated with climate change and the shift away from traditional energy models."

In 2016, together with a major UK pension scheme, Omi and the group's Head of Unit Trust Relationships, Nancy Kilpatrick, launched the Future World Fund in order to help investors address the long-term financial risk of climate change.

One component Omi is "very proud" of is the group's climate impact pledge, which follows in the footsteps of the Paris Climate Accord. Signed by 195 countries in November 2016, the accord is the world's first legally binding commitment to limit global warming to 2°C above pre-industrial levels, with a stretch target of 1.5°C.

Kilpatrick says that every day we're seeing the emergence of new technology that is helping the energy transition: from electric cars to cleverer ways of storing energy.

She added: "We think that parts of the fossil fuel industry will be outdated in the future; and if we can encourage and invest in companies which are helping the transition to a lower-carbon economy, we see that as a financial benefit for our clients."

Click here to find out more about why addressing climate change is in the interest of long-term investors

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