Don’t believe the myths, climate companies are thriving

The popularity of the climate and environment space has grown exponentially in recent years, with investors increasingly recognising the multiple drivers supporting this long-term megatrend. Despite this, two deep-seated investor misconceptions remain difficult to overcome. The first misunderstanding is the belief that climate and environment solutions essentially begin and end in the alternative energy sector. However, this narrow description significantly understates the broad investment opportunities available in this megatrend – particularly in companies within resource efficiency. The second fallacy is the perception that companies offering positive environmental solutions cannot deliver shareholder returns. While many companies were not able to generate steady cash flows in years past, this rapidly evolving sector is now being driven by healthy fundamentals. The thought that investing in the climate and environment sector will only be fruitful in a generation is also flawed; these solutions are delivering right now.