Foresight

How climate change could impact investment returns over the next 30 years


Each year Schroders’ team of economists helps investors take a truly long-term view with 30-year return forecasts for a range of asset classes around the world.

Uniquely, these forecasts take into account the impact of climate change, which is overlaid across a series of building blocks to come up with our estimates.

This year we’ve refined the methodology to better capture the impact of climate change on our return forecasts. In particular, the analysis now reflects the fact that temperature rises are not uniform, but determined within our modelling. It also captures the transition impacts of economy-wide decarbonization and a shift in investment towards clean energy.

The results from our latest update are slightly lower forecast returns across equities and fixed income. More than ever, the findings emphasize the importance of an active approach for the years to come.

The views and opinions contained herein are those of Schroders’ investment teams and/or Economics Group, and do not necessarily represent Schroder Investment Management North America Inc.’s house views. These views are subject to change. This information is intended to be for information purposes only and it is not intended as promotional material in any respect.