PT - JOURNAL ARTICLE AU - Yesim Tokat-Acikel AU - Marco Aiolfi AU - Lorne Johnson AU - John Hall AU - Jessica (Yiwen) Jin TI - Practical Applications of Top-Down Portfolio Implications of Climate Change AID - 10.3905/pa.2022.pa517 DP - 2022 Oct 12 TA - Practical Applications PG - pa.2022.pa517 4099 - https://pm-research.com/content/early/2022/10/10/pa.2022.pa517.short 4100 - https://pm-research.com/content/early/2022/10/10/pa.2022.pa517.full AB - In Top-Down Portfolio Implications of Climate Change, which appeared in The Journal of Portfolio Management special 2021 issue on novel risks, authors Yesim Tokat-Acikel, Marco Aiolfi, Lorne Johnson, John Hall, and Jessica (Yiwen) Jin of PGIM Quantitative Solutions explore the economic impacts of climate change from a top-down macroeconomic perspective. Climate change presents a significant source of uncertainty for the long-term investor. The authors’ stated goal is to quantitatively assess the impacts of climate change on long-term expected returns across major public assets and then explore strategic portfolio allocations. They provide a review of the significant academic and policy research done on climate change and its impact within the environmental, social, and governance (ESG) framework. The authors’ forecasts incorporate selected studies and data in order to quantitatively assess both an optimistic climate scenario and a pessimistic one.