Global State of Investor Climate Action
Why This Report Matters
The latest Global State of Investor Climate Action report was delivered just ahead of COP30 (1). While these global summits have a reputation for being talkfests, as mentioned previously, they still provide something investors cannot do without. They offer direction, policy signals and clarity about the global investment landscape. The report assesses more than 220 of the world’s largest institutional investors and reinforces a simple truth. Climate and environmental risks are now financial risks. They are shaping governance, portfolios and long-term strategy. (2)
Governance and Risk
The report opens with a clear shift in investor behaviour.
As per the report, 75 percent of investors assess the financial risks and opportunities that climate change poses to their portfolios. Another 75 percent have board level oversight of climate strategy. This is not a sustainability exercise. It is treated as core fiduciary responsibility. The widespread adoption of climate scenario analysis, undertaken by 67 percent of the sample, shows investors are mapping how different transition pathways influence valuations across sectors and regions. This level of integration means climate considerations are now being used to inform strategic asset allocation rather than left as an afterthought. (3)
Climate Solutions
Global investment in climate solutions is rising. As per the report, 70 percent of investors have already made some form of climate solutions investment. Yet only 30 percent have committed to growing these investments. This gap matters. Investors are identifying opportunities in renewables, transmission, storage, grids and transport, but constraints remain. These include limited deal availability in certain markets, challenges conducting due diligence in emerging economies and difficulty managing country and project risk. Blended finance is starting to bridge this gap, with development finance institutions working with private capital to de risk large scale transition projects.
Corporate Engagement
Corporate engagement remains one of the most widely used tools for climate action. As per the report, 73 percent of investors are engaging companies on climate issues and 57 percent are integrating climate considerations into proxy voting. There is also an increase in engagement relating to transition plans. Investors are scrutinising whether company plans are credible, time bound and aligned with expected transition pathways. This signals a move away from broad sustainability commitments and towards measurable, enforceable strategies linked directly to capital allocation.
Policy Engagement
Despite the importance of government policy, only 43 percent of investors in the sample engage with policymakers. This gap is a problem because climate policy sets the investment environment for sectors central to the transition. Interviews in the report highlight political instability and policy inconsistency as barriers to investor engagement. Yet the message is clear. Policy clarity reduces risk, improves investment economics and accelerates the flow of capital into climate solutions.
Transition Planning
Transition planning has rapidly shifted from optional to expected. As per the report, 56 percent of investors disclose transition plans and 51 percent have set net zero targets for 2050 or earlier. Europe leads with strong regulatory support, while Australia also ranks highly, reflecting growing alignment with global disclosure standards. Transition plans create the framework that ties targets, capital allocation, governance and resilience together. They also help stakeholders track whether investors are delivering on their commitments.
Nature and Just Transition
Nature is now a mainstream consideration. As per the report, 60 percent of investors include nature related disclosures in transition plans. Investors increasingly recognise the financial materiality of biodiversity loss and ecosystem degradation. However, the just transition remains underrepresented, with only 36 percent of investors outlining how they consider social impacts for workers and communities. This imbalance highlights the next frontier for investor action as social considerations become more relevant to long term portfolio resilience.
Implications for Australian Investors
For Australian climate focused investors, the report reinforces existing momentum. Local investors already demonstrate strong governance, high levels of risk assessment and growing transition planning. The appetite for climate solutions is rising across energy, storage, transmission, biodiversity and resilience infrastructure. With policy clarity improving and disclosure standards aligning globally, the opportunity set for Australian investors continues to expand. The broader message is consistent. Capital is shifting from brown to green, and the pace is accelerating.
The Bottom Line
The Global State of Investor Climate Action shows that climate risk is embedded in global investment practice. Governance standards have improved, engagement has intensified and transition planning has expanded. However, gaps remain in policy engagement, climate solutions scaling and just transition integration. For Australian investors, this is a strategic moment. Climate action is no longer optional. Those who act early will align with the direction markets are moving, while those who hesitate risk missing the next wave of transition investment.
References
The Investor Agenda. Global State of Investor Climate Action Report. November 06 2025. https://theinvestoragenda.org/reports/global/investor-climate-actiom
The Investor Agenda. Global State of Investor Climate Action Report Summary. November 06 2025. https://theinvestoragenda.org/reports/global/investor-climate-action/#summary
AIGCC. New Report Suggests Climate Change and Environmental Risk is Integral to Investors’ Considerations Around Their Investment Approach. November 06 2025. https://aigcc.net/new-report-suggests-climate-change-and-environmental-risk-is-integral-to-investors-considerations-around-their-investment-approach/
Important Information
EnviroInvest Pty Ltd ACN 685 107 957 (“EnviroInvest”) is an Authorised Representative of Daylight Financial Group Pty Ltd ACN 633 984 773 (“DFGPL”) which is the holder of an Australian Financial Services Licence (AFS Licence No. 521404). Information in this commentary is current as at date prepared unless otherwise stated. However, please bear in mind that investments can go up or down in value, and that past performance is not a reliable indicator of future performance. For more Important Information please refer to the Disclaimer section of this website. This communication may contain general financial product advice. It has been prepared without taking into account your personal circumstances, and you should therefore consider its appropriateness in light of your objectives, financial circumstances and needs before acting on it. If our advice relates to the acquisition or possible acquisition of a particular financial product, you should obtain a copy of and consider the Product Disclosure Statement before making any decision.