Positioning for the net-zero transition

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The transition towards a decarbonized economy is underway. It will involve a massive reallocation of resources. Economies will be reshaped as carbon emissions are cut, inevitably impacting portfolios. •As an asset manager, BlackRock’s fiduciary role includes helping our clients navigate that economic transformation. As with all such economic shifts, we help clients position their portfolios to be resilient to its risks, seize its opportunities and strive for more stable and higher long-term returns. This paper is focused on that investment objective. •Navigating the transition in a portfolio requires taking a view on: i) how fast the transition will be; ii) how to mitigate for volatility and possible supply constraints along the way; and iii) the extent to which the transition path is already reflected in market pricing.