The toolkit will provide a framework for investors to understand the risks and opportunities involved in climate change and fossil fuel-aware investing, while offering various approaches to such investments.

Approaches, which can be used individually or together, include:

• Reducing or eliminating exposure to companies producing coal, oil and gas, nuclear energy or that own significant fossil fuel reserves;
• Maintaining select exposure to the energy sector by investing in companies with rigorous environmental practices;
• Focusing on opportunities across asset classes to invest in themes related to climate change and fossil fuel awareness. Examples include energy efficiency, renewable energy, energy storage and distribution, and alternative transportation such as electric vehicles; and
• Shareholder engagement through voting proxies, for example.

“The framework presented in the toolkit helps to clarify the different approaches to climate change and fossil fuel aware investing, and serves as a catalyst for action by providing a lens for portfolio construction that maintains a consistent, balanced focus on both impact and financial goals," said Lily Scott Trager, director of Investing With Impact at Morgan Stanley Wealth Management.