An article by Joseph Mariathasan published in IPE’s May/June 2026 magazine examining insights from ChangeNOW 2026, argues that, with seven of the nine planetary boundaries already breached, institutional investors can no longer treat environmental degradation as a distant risk.

He draws attention to the views of Rémy Estran-Fraioli, CEO of Scientific Climate Ratings, who highlights the need to integrate physical climate risks into valuation models and investment strategies.

In his panel discussion, Rémy Estran-Fraioli, CEO of Scientific Climate Ratings, an EDHEC Business School spin-out, cut directly to what is perhaps the most underexamined dimension of the transition agenda – physical adaptation. While mitigation has attracted the bulk of green finance attention over the past decade, the costs of adapting existing infrastructure, supply chains and communities to the physical reality of a warming world remain stubbornly under-capitalised.

Estran-Fraioli, whose firm integrates climate risk data into financial valuation models, outlined a four-stage process through which institutional investors can move from awareness to actual portfolio decisions:

• Exposure assessment – understanding which assets face specific hazards, whether floods, heatwaves, wildfires, or storm surge
• Translating that physical exposure into concrete financial terms: direct damage costs, increased labour expenses, revenue disruption
• Identifying resilience strategies – though Estran-Fraioli was careful to note that there is “no one-size-fits-all” solution, and that the cost of a flood wall protecting 500km of coastal road may exceed the road’s own value
• Making the investment decision based on risk appetite and economic trade-offs

Read the full article here.