Schroders Launches New Framework to Identify, Assess Climate Adaptation Investment Opportunities

Nature & Climate Perspective

**Schroders' adaptation framework channels institutional capital toward resilient ecological infrastructure, bridging the gap between physical climate risk mitigation and natural capital preservation. **

• Prioritizes natural infrastructure investments—such as Blue Carbon mangrove restoration and wetland rehabilitation—to enhance localized ecological resilience against extreme weather events.
• Complements LULUCF sequestration initiatives by targeting environmental buffers that safeguard vegetative biomass and long-term carbon stocks from physical degradation.
• Addresses structural vulnerabilities unmonitored by the ICVCM Core Carbon Principles (CCPs), reinforcing the permanence criteria by actively reducing systemic climate risk across project landscapes.

Market & Policy Outlook

**The launch establishes a systematic screening mechanism for institutional adaptation assets, shifting capital allocation beyond traditional decarbonization to physical asset resilience. **

• Accelerates institutional readiness for international climate finance integration, complementing non-market cooperation under Article 6.8 and Article 6.2 bilateral adaptation transfers.
• Reduces the cost of capital and enhances liquidity for non-mitigation resilience projects, establishing clear risk-adjusted financial metrics alongside conventional carbon yield.
• Equips enterprises with structured methodologies to address physical climate risks embedded in upstream Scope 3 supply chains, aligning with emerging SBTi guidance on corporate adaptation.