For years, anecdotes about a 'wall' of money being available for investment in good quality businesses were common - and to an extent, reflected by Scotland's deal flow, especially in the North east. Private equity houses vied with corporate buyers for the best dealmaking opportunities and few auctions would run without national or international investment interest.

Has that changed as a result of COVID-19 and climate change commitments? Almost certainly.

Investing during a pandemic brings challenges, and as well as conducting the usual diligence, investors need to identify which sectors will emerge strongly on the other side and which businesses will flourish.

The viability of investors' current portfolios have also come under careful scrutiny. Pre-pandemic, certain sectors and businesses would have required investors' attention but now, the majority of investments will have been impacted to some extent and bandwidth to consider new investment opportunities is limited as investors focus on their existing positions.

However, one important factor remains constant - the "use it or lose it" mantra. Investors generally have a set period to invest the funds they raise and, pandemic or no pandemic, they are incentivised to use these and make investments within the original timescales. If monies are uninvested and returned to their clients, the chances of raising further funds for future investments are limited. Accordingly, investors remain keen to invest in good quality Scottish businesses, provided that they remain strong or have flourished in spite of the pandemic.

Businesses involving hydrocarbons face a different, fast-changing landscape.

Corporate buyers still have appetite to transact in those markets, to gain critical mass, acquire technology, advance their ESG credentials, or because a target business is a good fit; but investors have to comply with their own financial backers' investment parameters.

Those financial backers are now universally interested in ESG credentials and while some appetite still remains for oil and gas focused businesses, it is already limited and becoming more so as the climate change movement progresses. The volatility of the oil price is also a factor that may dissuade generalist investors from dipping their toes into the market, as well as dwindling oil and gas industry expertise in the investor base and exit strategy considerations.

However, when is an oil and gas business not an oil and gas business? Do businesses involved in decommissioning fall into that category? What about those supplying services to the petrochemicals sector? Or oilfield service businesses that are partly transitioning into renewables?

While there are fewer investors who will consider pure oil and gas plays, appetite should be strong for businesses that can demonstrate transition or otherwise satisfy credit committee and funders' ESG requirements.

As many oilfield services businesses transition or diversify in an ESG-friendly way, it is likely that investor appetite will rebound. For the North east and its proliferation of world class energy service companies, that should be welcome news.

This article originally appeared in The Scotsman.