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Climate Assets monthly update: Are we there yet? Almost!

Date: 19 December 2023

2 minute read

We are ending a very challenging year with more promising news. Inflation has come down in the UK, Europe, and the US. Thus, central banks have changed their interest rate narrative, with markets pointing to interest rates falling next year. Hooray, I say! However, while central banks are close they are not quite there yet, as there is a fine line between rates declining and bond yields and equities rallying too fast, thus taking us back to where we started. Nevertheless, interest rates falling, or the expectation of interest rate declines, is what we needed for investment focusing on sustainability to start performing again, as we explained in our November article, Sustainable Investment: increasing optimism after a challenging period


COP28 has come and gone, and we praise the new position that there  needs to be a shift in focus from reducing emissions to transitioning away from fossil fuels. The pledge of US$700m, to the much needed ‘loss and damage’ fund, was also another important development. Our sustainable Investment Specialist, Toby Rowe, gives his views on the outcomes of the latest climate summit below.

COP28: A success? It depends on who you ask

The final version of the FCA's Sustainable Disclosure Requirements has been released.  It now introduces a set of four 'sustainable categories' for funds to demonstrate alignment with. Personally, I am very excited about the arrival of the final rules, as it will help clients and advisers alike distinguish between funds with a credible approach to sustainable investment and those without. Whilst a significant amount of work is underway to align our Climate Assets Funds, I remain confident that our approach and philosophy fits very well with the ‘sustainable focus’ category.    

Looking ahead, the scale of the challenge in tackling climate change continues to underpin investment opportunities across our investment themes. In particular, the electrification of transport remains in full swing, and economies of scale continue to develop. After a year of significant re-rating across our investable universe, we see attractive valuations across power electronics and automation to improve energy conversion, efficiency, and car performance as well as EV charging infrastructure.

Finally, the festive season is here, and we wish you 'Feliz Navidad, Próspero Año y Felicidad' – merry Christmas, and a happy and prosperous new year – with your loved ones.


Claudia Quiroz

Head of Sustainable Investment

I lead the sustainable investment team at Quilter Cheviot, dedicated to serve clients who would like to invest in companies offering solutions to the economic and environmental problems of urbanisation, climate change and resource scarcity.

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Climate Assets Funds

The Climate Asset Funds invests in companies that make a positive contribution to the world, with a strong underpinning of ethical values.

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