Investors in Europe’s big insurers will be among the losers as climate change hits balance sheets, while engineering companies are set to soar, according to a new report.

Stockpickers at UBS, the investment bank, in a 132-page study called Reacting to Climate Change, have tried to predict how companies will benefit or be hurt by new regulations or consumer choices.

Among the winners, the report says, is Siemens, the German industrial giant, because of its leading position building electricity generating equipment. The need for more efficient power generation will drive demand for new equipment and new technologies, UBS argues.

The bank also identifies Intertek, a mid-sized British industrial services company, as a climate change winner. The company carries out environmental testing and is developing a new market in quality control for biofuels.

Among the losers, UBS has picked out companies such as Drax, the British electricity generator, and RWE, of Germany.

These companies operate coal-fired power stations and are likely to be forced to invest heavily in new technology to reduce their carbon dioxide emissions.

British Energy, the nuclear generator, is a potential winner from climate change for the opposite reason. EDF, the French utility that also supplies electricity in the UK, is another supplier that uses nuclear power. About 80 per cent of its capacity is produced without emitting CO2 .

In its research, UBS has identified companies that will be hit by regulatory changes and new laws or taxes designed to curb emissions. It has also looked at sectors where consumers may choose to act differently for environmental reasons.

For example, Tesco and Marks & Spencer are cited as potential winners because they are leading the debate on how to curb emissions in the retail sector. As consumer perception on the need to cut CO2 emissions hardens, the supermarket groups are best placed to benefit, UBS says.

The bank’s analysts also say that the corporate effort being put into tackling climate change by companies such as Tesco and Unilever demonstrates a broader commitment to risk mitigation.

Julie Hudson, the report’s lead analyst, said: “The way they handle climate change risk says something about the quality of their risk controls more generally. It also shows strong leadership and these are important characteristics when we look at a company more broadly.”

UBS is also working on a global list of climate change winners and losers and has already identified GE, the United States-based industrial conglomerate, as a potential winner because of its push into eco-industries.

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