FFIN
Climate Impact & Sustainability Data (2021-02, 2023-01 to 2023-06)
Reporting Period: 2021-02
Environmental Metrics
Climate Goals & Targets
Environmental Challenges
- Supply chain disruptions
- Potential for high inflation
- COVID-19 pandemic impact on economic recovery (particularly in Europe)
- Over-centralization of manufacturing in China
Mitigation Strategies
- Companies adapting to a non-centralized workforce
- Discussions in boardrooms about regionalizing manufacturing
- Push by US administrations to encourage domestic manufacturing
- Increased healthcare spending to replenish supplies and boost R&D
Supply Chain Management
Climate-Related Risks & Opportunities
Reporting Period: 2023-01 to 2023-06
Environmental Metrics
Climate Goals & Targets
Environmental Challenges
- Inflation remains sticky.
- Concerns about a weaker than expected reopening in China and persistent inflation in Europe.
- Higher interest rates increase the attractiveness of bonds, which should reduce the PE multiples investors are willing to assign to stocks.
- The biggest challenge for stocks in 2023 still involves central banks navigating how to remove emergency stimulus policies needed during the depths of the pandemic without tipping the global economy into recession.
- A watchful eye also needs to be kept on the strength and durability of China’s reopening from COVID lockdowns.
- With interest rates still moving higher, the perceived strength of regional banks and their ability to lend adds another wrinkle to an already complicated puzzle.
Mitigation Strategies
- Boosting select positions in healthcare, utilities, and real estate in portfolios to take a more defensive tilt.