A new report by BlackRock Investment Management has identified five megatrends it believes are shaping the investment landscape.

According to the report, "interconnectivity" in the world today means none of the five trends exists in isolation. "When the trends collide and overlap, new investment themes appear," it says.

The report also argues that there is "potentially significant value" in aligning portfolios to these longer-term structural trends.

As the business landscape adapts and changes, the authors advise, investors should focus on opportunities - while also making rational, well thought-out decisions.

Here are the 5 megatrends:

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Climate change and resource scarcity

Climate change will lead to crop failures, widespread flooding, destroyed habitats and energy shortages, according to the report.

Western diets are expected to become increasingly plant-based; renewable energy will fully replace fossil fuels; technological advancement will yield man-made materials.

In order to meet the increased food demands, the agricultural industry will need to continue to innovate to become more productive with fewer resources and inputs, the authors say.

As tariffs are placed on internal combustion engine vehicles, experts predict that by 2040 we will all be driving electric vehicles.

Urbanisation

Space and accommodation will become more of an issue in major cities, predicts the report. In 1950, 30% of the world's population lived in urban areas, and that's forecast to increase to 66% by 2050.

"These large-scale shifts lead to both opportunities and challenges for society. The requirements of future urban populations will be remarkably different to the cities of today, with citizens demanding connectivity to everything - every device, every entity and every object," states the report.

"Mass migration will mean the need for new infrastructure and services. A lack of space and the rise of autonomous cars will mean fewer people will own a car, preferring to use 'summonable services' instead."

Healthcare systems will have to change as population density grows to unprecedented levels, it adds. Personal security will be a focus with higher crime rates in cities than rural areas.

Governments will employ elevated levels of surveillance on citizens in cities, increasing connectivity means that every activity is logged and monitored. "Smart cities" will emerge, driven by modern urban populations that embrace technology to improve the efficiency of infrastructure and services, the authors predict.