The Octopus Climate Change Fund offers investors exposure to companies that are delivering the solutions essential for the transition to a low carbon, sustainable economy. This includes building clean energy sources, driving environmental efficiency, reducing waste, and developing sustainable systems for water and land use.
The global trajectory is toward net-zero emissions
Achieving the urgent and considerable goal of limiting global warming to no more than 2 degrees above pre-industrial levels requires governments to meet their net-zero (reduction in greenhouse gas emissions) commitments by 2050. This monumental undertaking is essentially a sustainable industrial revolution, demanding vast investment. By 2030, the International Energy Agency (IEA) projects that annual global investment will hit $4.5 trillion, reflecting the cost of necessary physical and digital infrastructure to meet these 2050 climate objectives.
This presents an exciting opportunity for investors, driven by innovative companies whose products and services will bring about real, industry-wide change.
The Octopus Climate Change Fund invests in companies providing solutions across key climate and environmental themes:
- Resources and Energy: Focusing on power generation and sustainable resource management, including clean energy sources, enhancing grid efficiency, sustainable agriculture practices, and water management solutions.
- Buildings and Infrastructure: Targeting solutions for sustainable urban areas, such as green buildings, energy efficiency technologies, and sustainable infrastructure development.
- Transportation: Enabling a shift to sustainable transportation, specifically electric vehicles, the creation of sustainable transport systems, and improvements in fuel efficiency.
- Product Lifecycle Solutions: Concentrating on optimising product use and disposal through initiatives like improved industrial efficiency, specialised and sustainable materials, the principles of the circular economy (make – use – return), and environmental services.
The path is not a straight line
The Octopus Climate Change Fund has a focused portfolio of around 40 companies selected for their climate solutions, resulting in a relatively high-risk investment due to its concentrated nature. Over the past three years, the Fund has faced significant structural challenges in the clean energy sector and broader macroeconomic headwinds. These factors have slowed the transition to a low-carbon economy, and resulted in financial underperformance compared to the wider market, despite opportunities to diversify and mitigate risk.
The fundamentals of a low carbon sustainable economy are showing improvement. This strengthening is driven by a more compelling economic case, which includes enhanced cost-competitiveness, the growing significance as part of modern industrial infrastructure, and its contribution to energy security.
Momentum is building, and the destination is certain
Tackling climate and environmental challenges requires more than just corporate efforts; the solutions offered by companies also provide competitive advantages and economic and security benefits for nations. This is evidenced by the UK government’s actions, such as the 2025 launch of Great British Energy (GBE), which aims to be a global clean energy leader, and the commitment of a £27.8 billion National Wealth Fund (NWF) budget to finance transformative UK projects.
The Octopus Climate Change Fund is likely to continue to experience higher volatility compared to more diversified investments, meaning it is best suited as a component of a diverse investment portfolio, rather than an investor’s total portfolio. However, 2026 first quarter’s performance is in line with global equity markets. Recent events have also shown the rising demand for clean energy is now offering resilience against energy price shocks and reducing reliance on fossil fuels.
While the current energy crisis is expected to significantly impact the global economy, the economic rationale for reducing greenhouse gas emissions is accelerating. This should give confidence to investors about the future financial performance of companies that provide climate solutions, which are demonstrating positive change and supporting the necessary sustainable industrial revolution.
Showing Positive Progress
Positive change achieved by the Octopus Climate Change Fund is detailed in the 2025 Sustainability Review. This review provides investors with case studies, across key investment themes, that demonstrate the solutions offered by the companies held within the fund.
We hope the information in this article is useful, but it isn’t financial, personal or tax advice. If you’d like advice, Octopus Money can provide professional help. Remember, the value of investments can go up and down, so you may get back less money than you put in.
You should think of investing as a medium to long-term commitment – so be prepared to invest your money for at least five years. Tax depends on your individual circumstances and the regulations may change in the future.
