Inevitable Policy Response analysis study published

The publication of the Inevitable Policy Response analysis is the results of a collaboration between Vivid Economics, Energy Transition Advisors (ETA) and the United Nations-supported Principles for Responsible Investment (PRI) on the Inevitable Policy Response (IPR). The project used the Planetrics model to power its analysis.

Its objective was to investigate the case for incorporating a forceful policy response to the climate transition – the Inevitable Policy Response (IPR) – into strategic and financial decision-making. The purpose of the project is to re-orientate the expectations, actions and disclosure reporting of both the public sector and private sector towards a business planning world in which the IPR Forecast becomes a go-to base case, rather than more ‘business as usual’ scenarios such as the IEA New Policies Scenario.

The project makes the argument for why it’s rational for investors to expect a future like the IPR; how it could have an impact within a timeframe relevant to investors; and details what the IPR would look like on the basis of historical evidence and robust political and economic reasoning, to help investors build scenarios.

Using the Planetrics model, the project also demonstrates how the IPR might impact the global economy, major regions and sectors, and asset values, and examines potential investor strategic asset allocation strategies in light of these market responses.

The project is funded by the Gordon and Betty Moore Foundation through The Finance Hub (which was set up to advance sustainable finance), as well as ClimateWorks Foundation and KR Foundation.

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Summary report

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