First market survey on forward-looking climate data available NOW!

First market survey on forward-looking climate data available NOW!

This week, 2dII released a new report “Asset-Level Data and Climate-related Financial Analysis: A market Survey”, funded by the French Energy and Environment Agency (ADEME) and the European Commission LIFE program.
The study is a first of its kind survey of how physical asset-level and market intelligence can be used to assess climate-related financial risk and performance. 2dII has connected such data to financial portfolios in our SEI Metrics research project to assess how investment indexes and portfolios are (mis)aligned with the 2C climate policy goal, as highlighted recently by the FSB Task Force on Climate-related Financial Disclosures (TCFD).
The report answers critical questions for asset-level data’s strengths and weaknesses, such as:

  • What types of information are already available?
  • What are the key underlying sources and implications for data quality?
  • What are the key barriers to its use for financial analysis?
  • What is the role of market intelligence and asset-level data in the climate disclosure and data puzzle?

The study finds strong advantages (rich detail, universal coverage, forward-looking) and disadvantages (usability issues, cost) in currently available data sources as they pertain to climate-related risk assessment (see table below). However, it also provides a long term vision and practical near-term advice for data providers, users, and regulators to achieve a world where data is no longer the limiting factor in assessing climate-related financial risk.
The study was launched at two events in New York (BlackRock) and London (Jupiter AM), and we again thank our hosts and panelists.
As always, we look forward to your thoughts, comments, and questions.