(Yahoo! Finance) Climate change has been called a consequence of the world’s largest market failure. But as flows into ESG assets accelerate, it has led some to question whether or not sustainable investors are merely buying into a cycle of hype.
According to a new note from BlackRock that draws on a survey of 175 clients in Europe, the Middle East, and Africa, analysts “see no evidence of a sustainability ‘bubble’” and that sustainable assets have room to run as markets reprice climate risks.
Repricing assets to include climate risks “is a phenomenon that markets have woken up to in the last couple of years,” Vivek Paul, BlackRock Investment Institute UK chief investment strategist, said on Yahoo Finance Live (video above). “We believe though, crucially, that the majority of that repricing is yet to occur.” Paul also added that “while there will always be the odd company that might be overvalued, systematically, we believe we’re far from any sort of notion of bubble territory.”
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