Climate change and Environment

Although progress on several Sustainable Development Goals has stalled or even reversed due to geopolitical shifts and reduced international development funding, Addenda believes that investors have a critical role to play in slowing, and ideally reversing, environmental degradation. The health of environmental, social, and financial systems directly influences the stability of markets and economies. Reflecting this momentum, global energy‑transition investment reached a record US$2.3 trillion in 2025—driven by electrified transportation, renewable energy, and grid upgrades—and clean energy supply outpaced fossil fuel investment for the second consecutive year.

Climate change poses a profound systemic risk for investors, with studies warning that unmitigated warming could reduce pension returns by 30% by 2050, as global temperatures—already 1.2°C above pre‑industrial levels—continue to rise toward a projected 2.7°C under current policies. Intensifying heat, droughts, floods, ocean acidification, and shifting weather patterns are driving higher mortality, migration, food insecurity, and disease, disproportionately affecting vulnerable populations. Because cumulative greenhouse gas emissions determine long‑term warming and many climate impacts will persist for centuries, rapid and large‑scale investment is essential, with an estimated US$275 trillion in physical assets needed by 2050 to reach net‑zero. Energy efficiency, renewable power, low‑emission energy, and clean transportation are central to this transition, with renewables expected to grow more than 60% from 2020 to 2026.

Addenda’s Sustainable Investing approach acknowledges that continued economic success happens within the planetary boundaries where climate, biodiversity and natural systems are stable and resilient. We are committed to being at the forefront of delivering innovative sustainable investing solutions that help create a healthier, more prosperous world for all.

Stewardship is a core component of this commitment. We work with public policymakers and standard setters to promote sustainable financial markets, and we engage with investee entities and exercise our proxy voting rights to advance long‑term value. Together, these efforts support the sustainability of the economy and the communities we serve.

Click here to look at our Fossil Fuel Free and Climate Transition Strategies