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Capital at Risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.

This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or financial product or to adopt any investment strategy.

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BlackRock’s first climate-aware return expectations

We have reached an inflection point in sustainability. There has been a rash of commitments by governments, companies and investors alike to mitigate climate change. This tectonic shift towards sustainability represents a historic investment opportunity, in our view, and overhauling portfolio design is the way to capture it.

As the first steps to do this, we launch our first climate-aware return expectations. These capital market assumptions (CMAs) are the building blocks of our strategic asset allocations.

How do we incorporate climate considerations into our CMAs?

Climate change enters our CMAs via three channels: macro, repricing and fundamentals. We see carbon emissions as the primary driver of asset repricing and use this data to gauge “greenness” of companies and sectors to help us estimate the impact within and across asset classes.

Our CMA framework shows that companies and sectors that adapt to a more sustainable world will likely be rewarded with better returns than those who ignore climate change. Crucially, we don’t believe this is in the price yet.

What are the investment implications of our new climate-aware strategic portfolios?

Our climate-aware portfolios broadly have increased allocations to developed market equities at the expense of high yield and emerging market debt (ex-China). Technology, healthcare and financials are among the sectors we believe will likely see benefiting in the green transition.

Discover more about our climate-aware CMAs in full.

Read Climate-aware CMAs

Implementing climate considerations into your investment processes
Our BlackRock Portfolio Consulting team can help you to incorporate sustainability across all three stages of the portfolio construction process 1) objective setting 2) portfolio design 3) product implementation.
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Report: what are investors’ views on sustainable investing
425 clients across 27 countries representing an estimated U.S. $25 trillion in assets under management gave their insights, expectations, and outlook for the future of sustainable investing.1
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Delivering outcome by accessing ESG through multiple drivers of return

How ESG will affect all asset classes and drivers of return based on our framework of blending index, factors and alpha strategies in a well-structured portfolio.

Read the full whitepaper >

1 Source:  2020 Global Sustainable Investing Survey, BlackRock, Dec 2020.

ESG: How does your portfolio score?

The BlackRock Portfolio Consulting team could help evaluate and advance your portfolio’s ESG score, carbon emissions intensity and business involvement helping to bring you closer to your sustainable investment objectives.

Meet your partner at moments of change >

Sustainable Fixed Income: A source of resilience
The market volatility that stemmed from Covid-19 forced many investors to rethink their fixed income allocations. This shone a light (or can change to increased focus) on sustainable fixed income investing as a new source of resilience.
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What type of Sustainable investors are you?

Use the interactive tool to find out which sustainable indexing methodology best matches your investment objectives.

Find your match >

2021 outlook
Explore the latest investment views from the BlackRock Investment Institute (BII).
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Geopolitical risk dashboard
Explore our interactive dashboard with our latest thinking on geopolitical events and their impact on your portfolios.
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Portfolio solutions for you
We know that every investor has different portfolio needs. From technology, portfolio consultations to full outsourcing, explore the ways BlackRock could help you.1
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1 Source:  BlackRock Sustainability Survey Report, Nov 2020.