firms re-evaluate investment strategies to avoid irreparable ecological damage. Shifts away from fossil fuels also increase demand into alternate energy sources which requires revised investment strategies. The initial stage to mitigate climate change through financial tools involves ecological and economic forecasting to model future impacts of current investment methodologies on the environment. This allows for an approximate estimation of future environments; however, the impacts of continued harmful business trends need to be observed under a non-linear perspective. Cap-and-trade mechanisms limit the total amount of emissions a particular region or country can emit. Firms are issued with tradeable permits which they can buy or sell. This acts as a financial incentive to reduce emissions and as a disincentive to exceed emission caps. In 2005, the European Union Emission Trading Scheme was established and is now the largest emission trading scheme globally. In 2013, the Québec Cap-and-trade scheme was established and is currently the primary mitigation strategy for the area. Direct foreign investment into developing nations provide more efficient and sustainable energy sources. In 2006, the Clean Development Mechanism was formed under the Kyoto Protocol, providing solar power and new technologies to developing nations. Countries who invest into developing nations can receive emission reduction credits as a reward. Removal of atmospheric carbon dioxide has been proposed as a solution to mitigate climate change, by increasing tree densities to absorb carbon dioxide. Other methods involve new technologies which are still in research development stages. Research in environmental finance has sought how to strategically invest in clean technologies. When paired with international legislation, such as the case of the Montreal Protocol on Substances that Deplete the Ozone Layer, environmentally based investments have stimulated emerging industries and reduced the consequences of climate change. The international collaboration would ultimately lead to the changes that repaired the hole in the ozone layer. Climate finance Impact The European Union Emission Trading Scheme from 2008-2012 was responsible for a 7% reduction in emissions for the states within the scheme. In 2013, allowances were reviewed to accommodate for new emission reduction targets. The new annual recommended target was a reduction of 1.72%. It is estimated that reducing the amount of quoted credits was restricted more tightly, emissions could have been reduced by a total of 25%. Nations such as Romania, Poland and Sweden experienced significant revenue, benefiting from selling credits. Despite successfully reducing emissions, the European Union Emission Trading Scheme