Integration of Environmental Factors into Portfolio Risk Assessment

Apostolos Apostolou, Michael G. Papaioannou

2021 | Academic | Portfolio Construction, Risk & Performance

This article provides a novel framework for understanding climate-related adaptation, mitigation, and transition risks. It outlines a method for valuing climate-related risks in institutional investor portfolios. It stresses the importance of integrating environmental factors in portfolio risk assessment by obtaining accurate information on climate-related risks and developing appropriate frameworks.