Storebrand Asset Management critically examine the limitations of current passive investment strategies and standardised benchmarks in achieving the goals of the Paris Agreement. They argue that reliance on backward-looking emissions data and uniform decarbonisation rates can lead to misallocated capital and unintended risks.

Instead, the paper advocates for a dynamic, forward-looking, science-based investment approach, that actively allocates capital toward climate solutions and companies with credible transition plans. This includes integrating 'climate beta' exposures and diversifying portfolios with 'pure play' climate solution companies, aiming for a more effective alignment with the Paris Agreement's objectives.

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