Light Green Advisors: Climate Change

After years of looming on the horizon, climate change is now reshaping the legal and market framework for companies across all industry sectors – in the U.S. and abroad. Companies that succeed in adapting their practices to meet the climate change challenge are likely to create competitive advantages relative to their industry sector peers – and Light Green Advisors (LGA) is uniquely positioned to evaluate and capture those advantages for investors.

Since its inception in 1998, LGA has closely analyzed the corporate climate change challenge (see Reframing the Climate Change Debate , a joint LGA / Progressive Policy Institute initiative that calls for economy-wide, market-based approaches to greenhouse gas emissions reduction.) As with other environmental issues, LGA believes that corporate climate change responses can be analyzed and incorporated into profit-based asset management strategies.

For example, progressive companies in a variety of industry sectors are creating competitive advantages through energy resource efficiency and energy resource diversification. Climate change is a driver for corporate energy efficiency and diversification, and energy programs will increasingly differentiate companies.

While climate change is a global issue affecting many industries, greenhouse gas emissions regulations will more heavily affect certain industry sectors. LGA believes that proactive companies in those sectors are likely to gain advantages over their peers. Companies that address climate change as an opportunity to improve operations can reap additional financial benefits.

As a result, Light Green Advisors believes that climate change should be viewed as not only an environmental challenge, but also a significant business opportunity. The demand for new energy technologies, as well as alternative energy sources, is creating extensive new business opportunities, as will the demand for services relating to market-based approaches to emissions reduction, such as the trading of emissions credits. To review a recent LGA Sector Report on these new businesses, click here.

Light Green Advisors will continue to monitor regulatory and market developments pertaining to climate change, and will continue to advocate for the adoption of economy-wide, market-based approaches to greenhouse gas emissions reduction. To review some recent regulatory and market developments, click here for an LGA Issue Backgrounder on climate change.

Building on the global growth of carbon markets such as the EU Emission Trading Scheme and the links between energy and greenhouse gas emissions, LGA is developing a new type of special purpose environmental fund. If you or your organization is an accredited investor (as determined by the SEC) and you are interested in learning more about a new type of private equity fund, you can contact LGA by clicking here