Even Skeptics Can Profit From Climate Change

And returns by industry sector:

Putting ideas of climate change into an investment framework produces surprising results. For example, consider emerging markets.

A temperature increase of 2 degrees Celsius (3.6 degrees Fahrenheit) would theoretically return benefits for emerging market equities, infrastructure, real estate, timber and agriculture. It could result in such changes as longer growing seasons and better access to remote mineral-rich northern regions. However, an increase of 4 degrees would harm emerging market equities, real estate, timber and agriculture.

Other winners: Real estate, especially in areas with access to plentiful clean water. Coastal regions are potentially problematic.

Renewables also have potential for additional returns: The technology sector — whether it is alternative-energy companies or the new tech designed to reverse the impact of climate change — are also expected to gain from changes. In general, growth assets are likely to be more sensitive to climate risks than more defensive assets.

An intriguing collection of backers gives the 108-page report credibility. They include “16 investment partners, collectively responsible for more than US $1.5 trillion.” Government agencies that participated include the International Finance Corp., the private-sector arm of the World Bank Group; Germany’s Federal Ministry for Economic Cooperation and Development; and the U.K.’s Department for International Development. The report is broad, deep and credible.

There is an old joke about the physicist Niels Bohr. Noticing a horseshoe hanging over a door at his home, a visitor asked the Nobel laureate in physics if he believed in luck. “Of course not. But I understand it works whether you believe in it or not.”

You don’t have to be a believer in climate change to be willing to profit from it.