In the past few years, investors divested at least $6 trillion of assets from fossil fuel funds. Fossil free funds, on the other hand, bear minimal climate risk. These fossil free funds invest in companies that reduce its carbon footprint by assessing its total carbon emissions derived from the company's operations.
One more thing that is assessed is whether a company's management is taking necessary actions to reduce carbon emissions and produce products that are less carbon intensive. Companies with low carbon emission risk will be at an advantage to adapt to stricter carbon standards in the coming days.