Schroders, a global investment manager with $1.1 trillion assets under management, today launched its Climate Adaptation Investment Framework. The framework helps investors assess opportunities arising from growing demand for infrastructure, technology, products and services that build resilience to physical climate impacts.
Developed by Schroders in collaboration with CalPERS, it evaluates 102 climate adaptation activities – specific actions and solutions designed to address actual or expected climate impacts – spanning infrastructure, technology, products and services. The framework aims to provide a consistent way to compare the economic benefits these activities may generate and where those benefits may translate into compelling investment opportunities.
From strengthening infrastructure against floods and extreme weather to investing in resilient buildings, water systems and early-warning technologies, businesses and governments are directing greater attention to adapting to physical climate impacts. According to Boston Consulting Group, annual demand for climate adaptation and resilience solutions could reach $0.5 trillion to $1.3 trillion by 2030. However, not all of that potential spending will necessarily translate into viable investment opportunities – a distinction the framework seeks to help investors navigate.
“Investors have traditionally viewed the physical impacts of climate change primarily as a risk to their portfolios, but there is another side to that equation,” said Marina Severinovsky, Head of Sustainability, North America at Schroders. “Climate adaptation is increasingly becoming an economic and investment consideration in its own right, as businesses, governments and communities respond to a changing physical environment. Our aim with this framework is to give investors a clearer lens through which to understand how those changes could shape investment outcomes over time.”
Top-line findings and takeaways from the analysis include:
- The framework identifies a core set of 102 climate adaptation activities. Drawing from existing approaches to defining and classifying climate adaptation, the framework brings together activities spanning a diverse range of sectors for investment analysis.
- The analysis finds a strong economic case for adaptation. 95 activities are modeled aiming to prevent economic losses equal to or greater than their costs, with the median activity generating $3.10 in avoided losses for every $1 of modeled cost. In other words, spending on adaptation today can help avoid greater costs from climate-related damage in the future.
- Economic value does not necessarily translate into investor returns. The framework is designed to distinguish between where adaptation can create significant economic value and where investors may actually be able to capture that value through durable business models and cash flows.
“The need to build resilience is clear and growing. Not all adaptation solutions are investable on purely commercial grounds today; however, the framework Schroders has developed gives asset owners and investors a practical way to assess, compare, and prioritize investments. We hope it encourages productive conversations that strengthen portfolio and economic resilience,” said Nelson Da Conceicao, Sustainable Investments Director, CalPERS.
The framework can also be used to assess existing portfolios and provide a more concrete basis for engagement with companies around physical climate risk and resilience. It is intended to complement, rather than replace, conventional physical climate risk analysis. More information about the research and its findings can be found here.
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Schroders plc
Schroders is a global investment manager which provides active asset management, wealth management and investment solutions, with £867.8 billion (€1007.4 billion; $1151.8 billion) of assets under management at 30 June 2026. As a UK listed FTSE100 company, Schroders has a market capitalisation of circa £9.5 billion and operates across 36 locations. Established in 1804, Schroders remains true to its roots as a family-founded business. The Principal Shareholder Group continues to be a significant shareholder, holding approximately 44% of the issued share capital.
Schroders’ success can be attributed to its diversified business model, spanning different asset classes, client types and geographies. The company offers innovative products and solutions through four core business divisions: Public Markets, Solutions, Wealth Management, and Schroders Capital, which focuses on private markets, including private equity, renewable infrastructure investing, private debt & credit alternatives, and real estate.
Schroders aims to provide excellent investment performance to clients through active management. This means directing capital towards resilient businesses with sustainable business models, consistently with the investment goals of its clients. Schroders serves a diverse client base that includes pension schemes, insurance companies, sovereign wealth funds, endowments, foundations, high net worth individuals, family offices, as well as end clients through partnerships with distributors, financial advisers, and online platforms.
Important Information:
All investments involve risk, including the loss of principal. Our proprietary tools and frameworks are designed to enhance the research and evaluation process but do not guarantee favorable investment results. The views shared are those of the author or individual(s) quoted and may not reflect the views of Schroders Plc or any of its affiliates. Information herein and in relation to outputs from our proprietary framework have been obtained from sources we believe to be reliable but Schroders Plc does not warrant its completeness or accuracy. No responsibility can be accepted for errors of facts obtained from third parties. Reliance should not be placed on the views and information in the document when taking individual investment and / or strategic decisions. This document does not constitute an offer to sell or any solicitation of any offer to buy securities or any other financial instrument.
To readers in the United States: Schroder Investment Management North America Inc., 7 Bryant Park, New York, NY 10018-3706. CRD Number 105820. Registered as an investment adviser with the US Securities and Exchange Commission.
To readers in Canada: Schroder Investment Management North America Inc., 7 Bryant Park, New York, NY 10018-3706. NRD Number 12130. Registered as a Portfolio Manager with the Ontario Securities Commission, Alberta Securities Commission, the British Columbia Securities Commission, the Manitoba Securities Commission, the Nova Scotia Securities Commission, the Saskatchewan Securities Commission and the (Quebec) Autorité des marchés financiers.
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