The Climate Resilience Investment Framework explained

Released in June 2025, the Climate Resilience Investment Framework is an investor-specific resource to help develop individual climate adaptation and resilience plans. We take a closer look at CRIF, it’s ambitions and how it can help investors.

There is an increasing need for investors to manage physical climate risks as global average temperatures rise. Research shows that even if the Paris Agreement goals and global net zero emissions are achieved, physical climate risks pose material risks to investment portfolios.

Today, current global efforts are widely considered inadequate to meet that Paris goal. It’s in this context that physical climate risks are becoming more material, with climate-related events occurring with growing frequency and intensity.

The Climate Resilience Investment Framework (CRIF) aims to help investors to navigate this growing uncertainty.

This first version offers guidance for real estate and infrastructure, and will be expanded over time to include sovereign, sub sovereign, and corporate assets.

The first of its kind, it can help investors to establish appropriate internal governance and objectives, guide them in physical climate risk assessments, and then help to identify suitable ‘adaptations’ to improve resilience to impacts.

Finally, it outlines ways in which investors can use systems stewardship with the wider ecosystem to create an enabling environment that unlocks investment.  This first version offers guidance for real estate and infrastructure, and will be expanded over time to include sovereign, sub sovereign, and corporate assets. 

Importantly for investors with unique and individual mandates, CRIF is not prescriptive. It offers recommended action points to inspire the development and implementation of individual adaptation and resilience (A&R) plans, based on their own best interests and in line with overarching fiduciary duties to clients and beneficiaries. 

The impacts of climate change are unlikely to be in asset valuations 

CRIF is based on the widely recognised premise that physical climate risks will worsen as global average temperature continues to rise. To date, these risks are not appropriately priced into asset valuations, with the true costs of climate change hidden from asset owners. 

Proactively managing, and reducing whenever appropriate, physical climate risks should therefore be a priority. Simply retreating from highly exposed sectors and geographies is likely to shrink the investable universe and potentially negatively impact long term financial returns.

Physical climate risks manifest into financial risk via a myriad of transmission channels across all four risk categories: credit, market, liquidity, and operational. Investors are likely to find that they are most able to address these at asset-level.

Proportionality is key to target setting

Underpinning CRIF’s target setting methodology is the Physical Climate Risk Appraisal Methodology (PCRAM), a case study-led resource informed by industry. It supports investors to identify physical climate risks, understand their materiality, explore adaptation options to material risks, and analyse the best way forward. 

Integrated in the PCRAM approach is the principle of proportionality. PCRAM encourages investors to climate-inform investment decisions to the maximum practical extent possible, acknowledging that many factors might prevent the implementation of adaptation options. For instance, data quality may inhibit physical climate risk assessments, and ownership structures may impede the implementation of adaptation options. 

CRIF target setting promotes the PCRAM approach as a minimum expectation, representing the identification of material physical climate risks and plausible options to manage them. Implementation of adaptation options is promoted as best practice.

The framework promotes this as a cyclical process, triggered by factors such as improving data or tools, hazard changes, or at distinct points in the financing cycle. 

Working with wide stakeholders to create an enabling environment 

There are limits to what investors can do alone to manage physical climate risks and opportunities. Policy advocacy and wider stakeholder and market engagement will be fundamental to investor A&R plans. 

For instance, many vital adaptations are public goods which the private sector cannot alone finance. Engagement is needed to ensure that public investment unlocks private investment. Additionally, investors will need to engage with data service providers to identify and understand material physical climate risks.

They may also need to educate existing and potential clients and beneficiaries on the importance of assessing physical climate risks and recovering costs. Engagement with insurers and lenders is needed to ensure resilience investment is rewarded. 

CRIF provides a summary of what is currently considered relevant for investors to manage physical climate risks and opportunities. It helps them to develop their own individual A&R plans, while acting as a gateway to ongoing support. It is not designed to support the operationalisation of those plans, recognising that while all recommendations are relevant, not all are currently possible.

IIGCC will continue to provide support to unlock investor action as understanding develops. 

A dual-track approach to adaptation and mitigation

Investors should see adaptation and mitigation as complementary priorities. Efforts to mitigate climate change should account for its consequences. For instance, the mitigation potential of renewable energy investments is influenced by their efficiency and life expectancy, which climate change may affect. Adaptation, on the other hand, does not mitigate the root cause of rising global emissions.  

To facilitate investor efforts to pursue mitigation and adaptation strategies, CRIF shares a common structure. set of concepts, and recommended action points with the Net Zero Investment Framework. NZIF is the most widely used guidance by investors who have set a net zero commitment today.

The purpose is to not reinvent the wheel, but for IIGCC to support investment, risk, and sustainability professionals within investment houses to come together to comprehensively manage material climate risks and opportunities. 

Be the first to access our working groups, resources and guidance as an IIGCC member. Interested in finding out more? Get in touch today.