Amid rising regulatory and geopolitical uncertainty, the role of investors in driving progress – particularly in impact areas such as climate change – has never been more important. In the absence of consistent regulatory pressure, investors are uniquely positioned to advocate for practices that protect our environment and strengthen our communities. While investors may not wield the same authority as regulators, they do have the power to use their voices to hold companies accountable and emphasize the material and societal importance of impact considerations. And, as recent studies regarding climate adaptation show, companies increasingly recognize not only the risks, but also the potential long-term value of addressing these considerations.
New York Times
How the G.O.P. Bill Will Reshape America’s Energy Landscape
The giant policy bill passed through Congress by Republicans will eliminate tax breaks for wind and solar power and electric cars while maintaining some federal support for sources like nuclear reactors and geothermal plants. The legislation, which carries President Trump’s domestic policy agenda, provides a boost to fossil fuels and dismantles major initiatives introduced during former President Biden’s administration to fight climate change, even as scientists warn that rising temperatures are creating acute dangers from extreme heat, deadly wildfires, crop failures and floods. The bill will phase out a tax credit of at least 30% of costs for companies building wind and solar farms. Under the new law, projects would likely need to start construction within the next year — roughly by July 2026 — to have the best chance of getting the full credit, instead of 2034 under previous law. The changes most likely to impact consumers include the phasing out of tax credits for EV purchases and home energy efficiency improvements. The bill will end tax credits worth up to $7,500 to buy new or used electric cars by September 30, 2025 and phase out the end of the year tax credits aimed at helping homeowners perform energy audits, upgrade their insulation, buy electric heat pumps or more efficient water heaters, and install rooftop solar panels
Morgan Stanley
Sustainable Signals: Corporates 2025 (PDF)
In a survey of more than 300 companies worldwide, Morgan Stanley’s Institute for Sustainable Investing found that the potential for creating value is the top reason that companies pursue sustainability initiatives. The survey, which polled sustainability decision makers at more than 300 public and private companies worldwide with more than $100 million in revenue, found that 88% of companies view sustainability as a long-term value creation opportunity, two-thirds of companies say their sustainability strategies are meeting or exceeding expectations, and more than 80% of companies say they can measure returns on investment for sustainability-related projects.
Axios
Global clean-energy investment doubles fossil fuels
Record capital is flowing into energy despite geopolitical tension and economic uncertainty, but the picture varies among technologies, according to the International Energy Agency’s World Energy Investment 2025 report. Investment in “clean” tech — a catch-all term for renewables, grid tech, storage, nuclear and more — is slated to reach $2.2 trillion this year. That’s twice the $1.1 trillion for coal, gas and oil. Electricity sector investment is slated to reach $1.5 trillion in 2025, “some 50% higher than the total amount being spent on bringing oil, natural gas and coal to market.” However, the rapid growth in energy VC over the last decade has ended for now, with another drop in 2025 to follow declines in the past two years. While some elements of sustainable finance remain “robust,” the prior “flurry of activity” from banks to green their practices has slowed “as regulatory and policy support has ebbed in key markets.”
Bloomberg
LSE Group Study Finds $1 Trillion Industry in Climate Adaptation
According to a study by the London Stock Exchange Group (LSEG), more than 2,100 companies were able to generate over $1 trillion in combined revenues last year from products and services that contribute to climate adaptation. LSEG based its analysis on more than 20,000 companies globally, assessing their contributions to the green economy. The study found that adaptation-related revenues last year accounted for roughly a fifth of the $5 trillion global green economy, with green buildings and water infrastructure sectors the biggest contributors. If all companies deriving revenue from climate-positive strategies were taken as a single industry group, they would have had the second-best financial performance of any equity sector over the past decade.
Bloomberg
JPMorgan Touts Returns From Protecting Against Weather Shocks
Underinvestment by the private sector in climate adaptation is leaving potentially huge returns on the table, according to JPMorgan’s global head of climate advisory. Adaptation — the process of protecting assets against the physical damages associated with weather shocks such as wildfires, floods and droughts — has taken on a new urgency with the world now on track for warming of roughly double the critical threshold of 1.5°C. Investing in companies that are alert to such risks has significant financial implications, and investors not only stand to limit losses, but can tap into outsized returns, according to the report by climate scientist Sarah Kapnick, who was hired to advise JPMorgan’s corporate and investment banking clients on how to navigate the impacts of global warming. Kapnick also points to research from established sources such as the World Economic Forum, indicating that adaptation — if done right — can deliver a return on investment in some sectors as high as $43 for every $1 spent, equivalent to well over 4,000%.
Bloomberg
How Trade Wars Impact the Green Transition — What We Know So Far
While the impact of President Trump’s proposed tariffs has not yet been fully felt, there are some indications of what the tariffs will mean in the U.S. and globally. China is likely to export more clean tech, but to low- and middle-income countries. The country faces stiff tariffs proposed by President Trump, on top of tariffs former levied by President Joe Biden. Solar panels in particular are likely be caught up in the trade war, with Southeast Asian countries like Vietnam producing the majority of U.S. solar panel imports. Vietnam was initially set to have a 46% tariff imposed per the President’s April announcement, which was lowered to a better but not insignificant 20% per an announcement in early July, but that agreement is now in question. Vietnam’s loss may turn out to be India’s gain. If tariffs on Vietnamese imports are eventually set closer to the initially proposed 46% than the later reported 20%, India’s 26% tariff rate may be the better deal. That comes as India ramps up clean tech manufacturing capacity, including recently working to finalize a $1 billion subsidy to grow the solar industry.
