Craig Mackenzie, Head of Strategic Asset Allocation at Aberdeen Standard Investments, has said the asset manager finds a lot of “garbage scenario modelling” on climate change and that portfolio temperature scores are a “waste of time”.
Mackenzie, who was speaking at RI Japan 2021, said many climate scenarios, such as those provided by the Network on Greening the Financial System (NGFS), gave an unrealistic guide for the next decade.
“We are increasingly helping our clients try to understand how climate risk will affect their portfolios in the near term. While some are interested in the next 50 years, the vast majority are interested in the next 5 to 10 years. That’s what will affect the prices of equity and credit portfolios.”
He said Aberdeen had been working with consultancy Planetrics to “model much more realistic scenarios” that try to capture the regional variation in climate policy.
“The standard NGFS scenario assumes a single glob…