Most APAC firms exceed 2°C emission limits

Some cities are projected to see up to a 31% increase in extreme heat days.

Over 70% of listed companies in major Asia Pacific markets are on emissions trajectories that exceed the 2°C threshold, according to an MSCI report.

This is despite reports showing that by 2050, cities including Melbourne, Tokyo, and Shanghai are projected to see up to a 31% increase in extreme heat days under a 3°C warming scenario.

Specifically, Melbourne is expected to experience a 31% increase in days of extreme heat, 9% for Tokyo, 7% for Shanghai, and 5% for New Delhi.

However, the report indicates a significant opportunity, with transition-focused climate funds experiencing a nearly 20-fold increase in assets to $590b since 2018, and private capital increasingly flowing into high-emission sectors to accelerate decarbonisation.

On a sectoral perspective, 37% of investments in private capital climate funds are allocated to the utilities sector, compared with just 10% of publicly-traded climate funds.

Meanwhile, public climate funds tend to focus more on transition-enabling sectors, as 20% of go to the information technology sector and 12% are in materials.

In contrast, private capital funds allocate just 8% and 3%, respectively, to these industries.

“Regardless of where climate funds are based, they are investing primarily in the United States and only 13% in APAC,” the report said.