Clean Energy Transition

Guidance on Climate Transition Plans under ESRS For organisations navigating climate reporting and sustainability compliance, the new guidance on implementing climate transition plans under the European Sustainability Reporting Standards (ESRS) provides valuable support! The guidance provides an approach for organisations to meet the ESRS requirements by detailing disclosure obligations that align with key EU regulations, such as the Corporate Sustainability Due Diligence Directive (CSDDD) and the EU Taxonomy. This alignment helps ensure climate transition activities and sustainability disclosures meet broader European compliance standards, reinforcing their commitment to responsible and sustainable practices in line with EU legislation. 1️⃣ Purpose: Offers non-binding guidance to help organizations create effective transition plans for climate change mitigation. 2️⃣ Compliance: Maps out how ESRS aligns with EU laws like the Corporate Sustainability Due Diligence Directive (CSDDD) and EU Taxonomy, ensuring regulatory alignment 3️⃣ Structure: Covers all aspects of climate disclosure—from European frameworks and disclosure requirements to international standards 4️⃣ Paris Agreement Alignment: Organizations must disclose targets that align with the 1.5°C goal, showing commitment to global climate efforts 5️⃣ Decarbonization: Outlines required emissions reduction actions, including operational changes and product modifications. Organisations are required to outline specific actions, known as "decarbonization levers," which may include operational adjustments, product changes, and other emissions reduction initiatives 6️⃣ Investments: Specifies the need for transparent reporting on investments, including EU Taxonomy-aligned CapEx for sustainable projects 7️⃣ Disclosures: Companies involved in EU Taxonomy activities must show their alignment with taxonomy criteria for sustainable finance 8️⃣ Governance: Transition plans should be embedded within overall corporate strategy, backed by governance bodies to ensure alignment with broader goals 9️⃣ Progress: Regular updates on implementation are required, measuring action effectiveness toward emissions targets 🔟 IROs from climate change mitigation: The guidance stresses the need for organisations to assess and disclose social and environmental impacts, risks, and opportunities linked to their climate transition plans The guidance emphasises that climate transition plans should be fully embedded within a company's overarching strategy and be actively supported by governance bodies. This integration ensures that climate goals are not treated as standalone objectives but are interwoven with long-term corporate planning. By doing so, organisations can align their climate ambitions with their overall business objectives, securing strategic and governance-level commitment to climate action.

Climate Transition Planning 🌍 Climate transition planning is no longer a nice-to-have—it’s becoming a business necessity. With mounting regulatory requirements and investor expectations, companies must move beyond setting climate targets and demonstrate how they will achieve them through structured Climate Transition Plans (CTPs). CTPs are increasingly embedded in global regulations. The UK, Switzerland, Australia, Hong Kong, and Japan have mandated transition plan disclosures, and other regions are moving in the same direction. In the US, the SEC climate disclosure rule, although currently on hold, also includes transition planning for companies that have one. Many existing sustainability frameworks already incorporate CTP elements. The Task Force on Climate-related Financial Disclosures (TCFD) remains the foundational reference, influencing ISSB’s IFRS S2 standards, SEC climate disclosures, and country-specific regulations. The overlap between frameworks allows businesses to integrate CTPs into existing sustainability reports rather than treating them as standalone requirements. The UK’s Transition Plan Taskforce (TPT) and GFANZ provide structured guidance, while SBTi, CDP, and Climate Action 100+ offer tools to assess credibility and track progress. Beyond compliance, transition planning is a strategic advantage. Investors and financial institutions are embedding transition risk assessments into decision-making, and companies with robust, science-based transition plans are better positioned to access capital and strengthen partnerships. One of the biggest challenges remains financial planning. Only 5% of companies reporting to CDP in 2023 provided sufficient details on how they will fund their transition. Aligning sustainability strategies with CapEx, OpEx, and R&D budgets is essential to turn plans into real action. Businesses that act now will be ahead of regulatory shifts and well-positioned to mitigate transition risks. A strong climate transition plan isn’t just about reducing emissions—it’s about ensuring long-term resilience and competitiveness in a rapidly changing landscape. With regulations evolving across Europe, North America, and Asia-Pacific, the question isn’t whether companies should have a CTP, but rather how well-prepared they are to disclose and implement it. Source: @BSR #sustainability #sustainable #business #esg #climatechange #CTP #risks

The latest State of the Corporate Transition report by The London School of Economics and Political Science (LSE) and the Transition Pathway Initiative (TPI) is out! New TPI research on 2,000 companies ($87T market cap) reveals which businesses are actually prepared for the low-carbon transition - and which are falling behind. Insights I found particularly interesting: →Companies in automotive and electricity achieved emissions reductions 5x faster than steel and cement - not by accident, but because they invested in proven technologies early. →CEO Alert: Companies with a clear long-term and short-term climate strategy are winning additional revenue opportunities and are considered a safer investment → Successful planning means ✔️Clear tech roadmap - sectors with mature decarbonization options are already reducing emissions faster ✔️Capital alignment - though fewer than 1% of companies have committed to align capital expenditure with decarbonization goals ✔️Credible interim targets - not just 2050 promises → 10% global GDP is projected to be lost from climate damages in next 15 years → Early movers are capturing market share in emerging low-carbon segments → Cost of capital - investors increasingly reward credible transition plans with better valuations The overall assessment of the report is that the transition up and running. Early movers are positioning for competitive advantage while laggards face stranded assets and higher capital costs. #esg #sustainability #decarbonisation #planning #co2 #emissions

𝗪𝗵𝗮𝘁 𝗶𝗳 𝘄𝗲 𝗰𝗿𝗼𝘀𝘀 𝟮°𝗖 𝗯𝘆 𝟮𝟬𝟯𝟳 𝗮𝗻𝗱 𝟮.𝟱°𝗖 𝗯𝘆 𝟮𝟬𝟰𝟴? That’s not worst-case modelling. That’s the average projection across 𝘕𝘈𝘚𝘈, 𝘕𝘖𝘈𝘈, 𝘌𝘙𝘈5 and other leading datasets (𝘍𝘰𝘴𝘵𝘦𝘳 & 𝘙𝘢𝘩𝘮𝘴𝘵𝘰𝘳𝘧, 2025). This changes the game for long-term investors. 𝗧𝗵𝗲 Financial Conduct Authority’𝘀 𝗔𝗕𝗖 𝗖𝗹𝗶𝗺𝗮𝘁𝗲 𝗔𝗱𝗮𝗽𝘁𝗮𝘁𝗶𝗼𝗻 𝗙𝗿𝗮𝗺𝗲𝘄𝗼𝗿𝗸 𝗼𝗳𝗳𝗲𝗿𝘀 𝗮 𝘀𝘁𝗿𝗮𝗶𝗴𝗵𝘁𝗳𝗼𝗿𝘄𝗮𝗿𝗱 𝗮𝗽𝗽𝗿𝗼𝗮𝗰𝗵: 𝗔 – 𝗔𝗶𝗺 𝗳𝗼𝗿 𝟭.𝟱°𝗖 But let’s be honest, 1.5°C may be breached by 2026. So, while ambition matters, we must plan for where we’re heading, not just where we hope to stay. 𝗕 – 𝗕𝘂𝗶𝗹𝗱 𝗳𝗼𝗿 𝟮.𝟬°𝗖 Use 2.0°C as your strategic baseline. Design resilience into your Strategic Asset Allocation (SAA), risk models, and mandates across tangible assets, infrastructure, property, fixed income and equity portfolios. 𝗖 – 𝗖𝗼𝗻𝘁𝗶𝗻𝗴𝗲𝗻𝗰𝘆 𝗳𝗼𝗿 𝟮.𝟱°𝗖 Stress test for systemic shocks. Ask: how would our portfolio perform under cascading physical risks, e.g. floods, fires, crop failure, migration, and water stress? And who in our ecosystem is modelling this seriously? 𝗧𝗵𝗿𝗲𝗲 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝘁𝗼 𝗱𝗶𝘀𝗰𝘂𝘀𝘀 𝗮𝘁 𝘆𝗼𝘂𝗿 𝗻𝗲𝘅𝘁 𝗾𝘂𝗮𝗿𝘁𝗲𝗿𝗹𝘆 𝗯𝗼𝗮𝗿𝗱  1. Are our portfolios priced for physical climate risk, not just transition risk?  2. How are our managers building climate resilience into strategies and valuations?  3. What does a 2.5°C contingency plan look like for our fund? 𝗔𝗰𝘁𝗶𝗼𝗻: Add the FCA’s ABC framework to your next Board or Investment Committee agenda. Use it to test your governance, your SAA and your managers. This is no longer about TCFD reporting. It’s about risk, portfolio resilience, and future-proofing outcomes for your members. 𝗥𝗲𝗮𝗱 𝘁𝗵𝗲 𝗳𝘂𝗹𝗹 𝗙𝗖𝗔 𝗖𝗙𝗥𝗙 𝗿𝗲𝗽𝗼𝗿𝘁: 𝗠𝗢𝗕𝗜𝗟𝗜𝗦𝗜𝗡𝗚 𝗔𝗗𝗔𝗣𝗧𝗔𝗧𝗜𝗢𝗡 𝗙𝗜𝗡𝗔𝗡𝗖𝗘 𝗧𝗢 𝗕𝗨𝗜𝗟𝗗 𝗥𝗘𝗦𝗜𝗟𝗜𝗘𝗡𝗖𝗘 https://lnkd.in/eYcysQnx #AdaptationFinance #BoardAgenda #ClimateAdaptation #ClimateRisk #CFRF #FCA #ABC #FiduciaryDuty #StrategicAssetAllocation 

I am happy to co-author this article with Beatrice WEDER DI MAURO, President of the CEPR - Centre for Economic Policy Research, reflecting on the urgent need to engage in collective thinking and action to adapt our response to the challenge of insurability in the face of escalating climate risks. This article, which captures key convictions from our joint workshop hosted at Collège de France by the AXA Research Fund and CEPR - Centre for Economic Policy Research, couldn't have been more timely.   Devastating floods in Valencia, the wildfires in Los Angeles, the typhoons in Mayotte and La Réunion... These recent climate catastrophes show a clear reality: climate risks are intensifying and the protection gap for local communities and economies are becoming evident. Global economic losses from extreme weather events reached $320 billion in 2024, while in Europe, only 25% of economic losses were insured - leaving individuals, businesses, and communities vulnerable.    To address this, we need to enhance risk-sharing mechanisms and promote partnerships between public institutions and private companies.   Ensuring insurance accessibility and effectiveness is crucial. This can be done through: ➡️ Hybrid models, combining market mechanisms with public-private partnerships, to help ensure broad coverage and affordability. France’s CatNat regime and Switzerland’s hybrid model offer valuable insights. These models can be adapted to regions facing extreme exposure, such as sea level risks. ➡️ Greater investment in prevention and risk-sharing mechanisms. Initiatives like local municipal risk assessments can help small municipalities assess and mitigate local climate risks. ➡️ Impact underwriting, where insurers incentivize policyholders to adopt risk-reducing measures in exchange for lower premiums. ➡️ Public education on climate risks and stronger coordination between insurers, governments, and consumers to ensure preventive measures are taken seriously.   As we move forward, it's clear that policymakers, insurers, and society must work together to strike a sustainable balance between affordability and fiscal viability. This is not just about who pays the bill. It is about how we manage risk in an increasingly uncertain climate landscape. Let's continue to foster collaboration and innovation to close the protection gap and build a resilient future. 👇 https://lnkd.in/er6BkrtZ

Climate change isn't just an environmental issue. It's a critical business requirement. According to new research, businesses face significant risks from inaction, potentially losing 5-25% of their 2050 EBITDA. But here's the game changer: strategic climate adaptation could generate returns of $2 to $19 for every dollar invested. Key Takeaways: 🔹 Physical climate risks affect supply chains and operations. 🔹 Transitioning to a low-carbon economy provides opportunities. 🔹 Unprepared companies risk significantly higher cost pressure from carbon pricing or regulations. 🔹 Mitigation and adaptation strategies offer critical pathways to business resilience. 🔹 Companies must integrate climate strategy into their core business plans. Companies that actively manage climate risks will not only survive but thrive in a rapidly changing world. Are you prepared? World Economic Forum Boston Consulting Group (BCG) #sustainability #esg #climatechange #climateaction

The World Economic Forum'S 2025 Energy Transition Index shows clear progress: the pace of transition has more than doubled in recent years. But behind the headline lies a deeper challenge—our #energy systems are still fragile, strained by rising geopolitical and economic headwinds. Sustained, accelerated #reinvention is no longer optional. To deliver energy systems that are cleaner and more resilient, we must shift from incremental change to system-level transformation. In our latest collaboration, Roberto Bocca and I lay out five strategic actions to help leaders build the adaptive, future-ready energy systems the world needs now: 1. Adopt stable, adaptive policy frameworks that support long-term investment and cross-sector collaboration  2. Modernize infrastructure—especially grids and storage—to improve reliability and integration  3. Invest in skilled talent to unlock innovation and boost delivery capacity  4. Accelerate clean tech commercialization, particularly in hard-to-abate sectors  5. Boost capital flows to developing economies, where energy transitions must be inclusive and equitable The future of energy isn’t just about being clean—it’s about being competitive, inclusive, and shock-resistant. We believe the path forward starts with coordinated action, pragmatic policy, and bold investment. Because resilient energy systems aren't just a climate goal—they’re the backbone of global economic security. Read the full analysis: https://lnkd.in/gSAZ2XNg #ETI25 #EnergyTransition #Reinvention #EnergyResilience Dr. Britta Daum Espen Mehlum David Rabley Stephanie Jamison John Downie Ashwini R.

How can investors best position their portfolios in light of policy and regulatory changes, technological advancement and changing consumer behaviour? We start the year with a paper on just this question.    My colleagues Rebecca Thomas and Roland Rott, CFA outline key considerations for investors focused on net zero implementation, such as the recognition that decarbonisation rates will vary in sectors across the economy and that transparency over decarbonisation plans and targets is essential.    The Carbon Transition score that we’ve constructed can be used alongside tools like the EU Climate Transition Benchmarks to give deeper insights that take these additional considerations into account. Our paper also explains how the score can help identify leaders and laggards in the low-carbon transition and be used to construct equity and fixed income portfolios aligned with decarbonisation objectives. You can access the full paper here: https://lnkd.in/ej2FMf-G #climateinvesting #sustainableinvesting

Beyond the Buzzwords: Sustainability in Action in Southeast Asia 🌏⚡🌱 Last week, I had the privilege of co-leading the London Business School Experiential Course in Singapore and Malaysia with Prof. Nitish Jain, exploring what sustainability really looks like in practice—beyond the headlines, beyond compliance checkboxes, and beyond ideological debates. In Southeast Asia, sustainability isn’t an abstract ambition; it’s embedded in economic strategy, financial decision-making, and long-term resilience planning. 🔥 Supply Chains & Pragmatic Solutions—Visiting a palm oil plantation and mill in Malaysia brought home the reality of transforming legacy industries. Seeing firsthand how supply chains are evolving—through better land management, certification programs, and investment in sustainable practices—reinforced that pragmatic transitions beat rigid ideology every time. The road is complex, but progress is happening. 💰 Finance as the Enabler—While some markets are caught in an ESG backlash, here, capital is driving change, not avoiding it. The focus isn’t on exclusion—it’s on funding the transition. From carbon pricing strategies to blended finance mechanisms, the region is finding ways to make sustainability viable rather than treating it as a constraint. This approach—one that sees sustainability as a tool for risk management and value creation—felt refreshingly forward-looking. ⚡ Energy Transition: No Easy Answers, Just Action—Decarbonization is a long, complicated road. Yet, instead of debating whether it’s possible, the focus is on how to make it happen without derailing economic stability. The region is investing in infrastructure, regional energy integration, and emerging technologies—because transitioning an economy isn’t about flipping a switch; it’s about making the shift structurally viable. 🏙️ Beyond Net Zero: Resilience & Adaptation—This trip reinforced something critical: mitigation alone won’t be enough. From supply chain risks to urban planning and healthcare systems, adaptation is now a central pillar of sustainability strategy. In a world of accelerating climate impacts, the businesses and economies that prepare for volatility will be the ones that thrive. At its core, this week was a powerful reminder that sustainability is no longer just an obligation—it’s an opportunity. The companies that see it as a source of innovation, strategic advantage, and long-term value creation are the ones shaping the future. A huge thank you to the LBS students, speakers, and organizations who made this such a dynamic and thought-provoking experience. And a special thanks to the LBS team who worked tirelessly behind and in front of the scenes to organize and deliver such a seamless and enriching week! Anna Gileva Elsa Jolley Mariam Elmahdey Charlotte Smith 👏 #Sustainability #LBS #GlobalExperience Kirstie Papworth Christopher Moseley, MCIPR

"We need to invest more to bring women to the table, both because we need to put all the best brains at our disposal, and because how we design our energy future will have a significant bearing on women’s lived experiences.” - Rose M. Mutiso, Ph.D., Research Director at The Energy for Growth Hub Women and girls are the main users and producers of household electricity, so any transition to clean energy must include them. The Rockefeller Foundation is proud to invest in organizations like the Energy for Growth Hub working to advance the just #energytransition for women, girls, and other vulnerable people. Their work in backing African research on #cleanenergy solutions and raising the modern energy minimum are the kind of people-centered solutions we need to reverse the #climatecrisis and end energy poverty. Learn more about how they are advancing women-led energy development in Africa. https://lnkd.in/e4Grn44E