This 2026 assessment evaluates 50 of the largest North American investors, comprising 25 asset owners and 25 asset managers, based on their 2025 public disclosures. The analysis indicates that despite dramatic shifts in the political and regulatory environment, particularly in the United States, investors are continuing to capture opportunities in the 21st-century clean economy while managing the financial risks posed by a changing climate. The report applies over 60 indicators mapped to the Investor Climate Action Plans (ICAPs) Expectations Ladder, spanning areas such as investment, corporate engagement, policy advocacy, disclosure, and governance.

Focusing on disciplined risk management practices

Investors are increasingly shifting from broad headline commitments towards the implementation of risk management strategies. The findings show that nearly three-quarters of assessed investors now evaluate climate-related portfolio risks, with 64% using climate scenario analysis to identify exposure under various conditions and timeframes. Material financial risks, including wildfires, flooding, and chronic heat stress, are now viewed as central to both value creation and risk mitigation.

Governance of these risks has been integrated into core investment architecture, with 74% of investors assigning formal oversight responsibilities for climate strategy, typically at the board level. To demonstrate that climate issues are being treated as fiduciary and strategic priorities, 32% of investors have disclosed standalone climate transition plans. These plans outline how institutions manage risks across portfolios, engage with companies, and oversee implementation at the highest levels of governance.

Allocating to climate solutions as a market opportunity

Energy security, volatile fossil fuel prices, and surging electricity demand are creating new investment opportunities in sectors such as renewable energy, energy storage, and green cement. Amongst the top 50 investors, 74% are currently allocating capital towards climate solutions. However, despite this growing recognition, only 22% have disclosed explicit, measurable targets for increasing these investments, indicating a lack of publicly committed capital relative to transition needs.

Scaling these investments remains challenging due to structural constraints, such as mandates developed around traditional asset classes and internal capacity limitations. Many investors are also hindered by benchmark-relative risk, as traditional benchmarks are often sector-weighted based on backward-looking data. For investors to accelerate allocations, benchmarks need to better reflect future forces like technology adoption. Additionally, adaptation investing is gaining focus; 24% of investors allocating to climate solutions disclosed investments in infrastructure hardening and water security. The report suggests that platform-based investment models could help match institutional capital with smaller, fragmented projects.

Sharpening engagement strategy for real-economy emissions reduction

Corporate engagement remains a primary strategy for investors seeking to drive emissions reductions, with 72% of investors engaging portfolio companies through direct dialogues, initiatives, shareholder resolutions, or proxy voting. Engagement has matured significantly, with 67% of those investors now explicitly engaging on company transition plans and the realignment of capital expenditures to meet climate goals.

Policy engagement is also recognised as a critical tool for addressing portfolio risk. The assessment found that 48% of investors have a strategy for climate policy engagement with governments, and 44% have already undertaken such efforts. Priorities have evolved beyond disclosure requirements to focus on resolving structural constraints, such as permitting reforms for renewable energy projects. However, investors face challenges including concerns about political retaliation and divergent client views, which can make firm-wide positions difficult to maintain.

Considering nature and water impacts as rising strategic priorities

There is a growing understanding that climate-related financial risks are deeply interconnected with nature loss and water scarcity. The report found that 52% of investors disclosed evidence of considering nature and/or water-related risks in their investment and stewardship practices. Furthermore, 36% of investors with engagement strategies now incorporate these issues into their approach, asking companies to disclose impacts such as deforestation and biodiversity loss.

On water specifically, the rapid expansion of artificial intelligence infrastructure and data centres is intensifying investor focus on water security due to the high volumes required for operation. Investors are identifying new opportunities in this space, with 27% of climate solution investors disclosing allocations to water-related technologies like leak detection and desalination infrastructure. Additionally, 24% of climate solution investors allocate capital to nature-related opportunities, frequently through the lens of carbon sequestration.

Just transition as a strategic consideration

The human impacts of the transition to a low-carbon economy, including workforce transition and community resilience, remain under-recognised within current investor strategies. Only 12% of investors explicitly disclosed considering a just transition in their investment practices. This gap is notable because social backlash against poorly managed climate measures can trigger policy reversals and macroeconomic instability. Currently, investors largely treat this as an engagement topic rather than embedding it into broader investment strategies or policy advocacy.