The Climate Resilience Investment Framework (CRIF) 1.0 is the first of its kind, an investor-specific and comprehensive resource to help develop individual climate adaptation and resilience plans.
Developing adaptation and resilience (A&R) plans are vital for investors. Physical climate risks have always existed, and can already be material to investment portfolios. However, increases in atmospheric greenhouse gas concentrations associated with human-induced climate change are expected to increase their materiality and significantly affect asset performance and credit worthiness.
This framework has been developed by IIGCC with the support of members, spread across four working groups. A public consultation was held to allow external stakeholders to provide input.
Supporting investors
CRIF supports investors to use the levers available to them to better manage physical climate risks from a financial materiality lens. It can help investors:
It provides recommended action points which can inspire investors in the development of their own individual A&R plans, but remains agnostic to the individual approach which must be context specific.
Underpinning target setting methodology is the Physical Climate Risk Appraisal Methodology, which supports investors to identify physical climate risks, understand their materiality, explore adaptation options, and analyse the best way forward within decision making.
CRIF 1.0 is first version of IIGCC’s new framework that supports investors to develop climate resilience goals and implementation strategies. Currently, it offers guidance for infrastructure and real estate classes, with PCRAM specifically designed for these types of assets. Over time it will be expanded to cover sovereign bonds, sub-sovereign, and corporate assets.
A gateway
The framework 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.
Nor is it prescriptive: CRIF lays out the potential components of an investor specific A&R plan, but is agnostic about how they implement their proposed plans to manage their own individual portfolios.
As independent fiduciaries, with their own strategies, policies and practices, based on their own best interests and in line with their overarching fiduciary duties to their clients and beneficiaries, it is for investors to individually decide how to design and implement their own A&R plans.