Twelve Major Indian Mutual Fund Houses Score Zero on Climate Stress-Test Disclosures, Study Finds

Key Takeaways

A Climate Risk Horizons study found that 12 major Indian mutual fund houses received zero scores for disclosures relating to climate scenario analysis and portfolio stress testing.

The fund houses assessed collectively represented more than 80% of India's mutual fund industry assets.

Although the assessed firms had stewardship or sustainability oversight frameworks, the study found gaps in disclosed portfolio-level climate risk analysis.

Climate Risk Study Identifies Disclosure Gaps at Indian Mutual Funds

Twelve major Indian mutual fund houses received zero scores for climate scenario analysis and stress-testing disclosures, according to a study by research organisation Climate Risk Horizons.

The findings, reported by Bloomberg and The Economic Times on November 2, 2026, indicate that portfolio-level climate risk reporting remains limited among some of the country's largest asset managers.

The assessed fund houses collectively accounted for more than 80% of Indian mutual fund industry assets.

The zero scores relate specifically to the disclosures evaluated under the study's climate assessment methodology. They do not necessarily establish that the firms conduct no internal climate-related risk assessments.

What the Study Examined

Climate scenario analysis evaluates how financial assets could be affected under different environmental and economic conditions.

For mutual fund portfolios, such assessments can consider the consequences of higher temperatures, extreme weather events, changing energy policies and the transition towards lower-emission economic activity.

Stress testing examines how these scenarios could affect the financial position or valuation of portfolio companies.

According to the study, the assessed fund houses did not disclose sufficiently detailed analysis showing how their portfolios might respond to scenarios involving rapid energy transitions, delayed climate action, physical climate hazards or stranded assets.

The researchers also identified an absence of disclosed financed-emissions data among the assessed firms.

Financed emissions refer to greenhouse gas emissions associated with investments and financing activities.

Existing ESG Frameworks Do Not Necessarily Include Stress Tests

All 12 assessed fund houses reportedly maintained some form of stewardship framework or environmental, social and governance oversight.

However, these arrangements did not translate into the detailed climate scenario disclosures examined by the researchers.

Stewardship policies typically describe how an investment manager monitors investee companies, exercises voting rights and engages with corporate management.

Climate stress testing addresses a different question: how particular environmental and policy scenarios might affect the value of assets held in a portfolio.

The distinction matters because the existence of an ESG policy does not automatically establish that a portfolio's exposure to climate-related financial risks has been quantified.

How Indian Disclosures Compare With Asian Peers

The study also compared Indian asset-manager disclosures with practices in other markets.

According to the reported findings, roughly two-thirds of the Asian asset managers used for comparison disclosed at least some climate scenario analysis.

Climate Risk Horizons recommended stronger disclosures and more detailed assessments of how climate-related developments could influence investment portfolios.

The findings highlight a difference in reporting practices, although disclosure scores should not be treated as a direct measurement of mutual fund investment quality or future performance.

The study's main contribution is to identify the information currently available to investors seeking to understand climate-related financial exposure.