Stephanie Maier
Lee Clements
Key takeaways:
- Climate physical risk will increasingly present rising costs and impacts on lives, livelihoods and economies. Climate adaptation and resilience, alongside transition, will be in focus for investors, corporates and governments. Global energy transition will continue to grow rapidly from renewables to energy efficiency. Subsidy changes in China and US will be felt, but growth is expected to continue given underlying electricity demand, low cost and speed/scalability.
- As the global AI data centre build out continues, access to power remains critical and we move into an operational “show me” period. The impact of efficiency on costs and productivity and delivery of end user process optimism and emission reduction will be in increasing focus.
- Asia will be at the epicentre of climate/sustainability in 2026, with focus on China’s delivery of its emission cutting pledge and dominant position in the clean energy market. India will become an increasingly important ‘swing factor’ for the direction of the climate.
- Beyond climate, critical areas such as healthcare and food have seen cost pressures, regulatory challenge and poor investment performance in recent years. As large, geopolitically essential sectors with strong exposure to demographic drivers and a lot of underlying innovation they should remain in focus for sustainable investors in 2026.
Points of differentiation:
- We found continued activity in key areas of sustainability in 2025, despite geopolitical headwinds, with expectations of continued growth in 2026. In particular from growing physical climate risk and continued energy transitions.
- However we find areas of sustainability are also changing, with technologies such as nuclear and grid infrastructure gaining importance, the Technology industry providing both headwinds and tailwinds and Asia being at the centre of some of the most important developments.
- Looking at two large areas of sustainability, worth trillions of dollars and impacting tens of millions of lives, but often overlooked in sustainability discussions, Healthcare and Food.
What does our research mean for investors?
Our research highlights the degree to which sustainability issues continue to change the world and remain a key element of an investor’s toolbox. It also focuses on where the sustainability market is evolving, such as the growing impact of physical climate risk and growth of adaptation. We see continued momentum of the energy transition, areas such as nuclear and grid infrastructure gaining importance and increasing impact on conventional markets such as oil. Despite the elevated status of sustainability as a geopolitical topic in Europe and North America, we see Asia as the region where the most important things are happening, from the continued growth of China as a clean energy super power, to Japan’s ambitious transition program and India’s increasingly pivotal importance on the future direction of global emissions. Finally we look at two large, but often overlooked areas of sustainability, Healthcare and Food.
