Problem

  1. Beyond listed equities in OECD countries, investors lack insight about climate risk and opportunities, as well as plentiful high-quality investment vehicles. Existing tools for investment analysis:
    • Can’t rigorously quantify the impact of most climate-related factors on risk and return, aside from carbon, energy prices, and a few policy drivers – failing to capture dozens of key variables in technology, public and private policy, resources, consumer and B2B preferences, climate and weather, and the macroeconomy.
    • Lack the transparency many investors require to trust them.
    • Fail to address adaptation & resilience.
    • Lack global coverage, especially developing countries.
    • Don’t work well for investments other than public equities.
  2. Asset owners with tens of Trillions of dollars in assets recognize climate change as a systemic risk, but most won’t significantly reallocate to climate-wise investments — especially in developing countries — until superior analytics become the market standard and climate risk can be accurately priced.
  3. Cost of data and computing required for analytics that cover all the financially material factors makes commercial tools unaffordable for many users, especially small firms, subnational government agencies, and NGOs.
  4. Given development cost and inability to get sufficiently high prices, large commercial providers lack a business case for building products to cover investments in emerging markets and in adaptation.
  5. Emerging financial regulations, including those presaged by the Task Force on Climate-Related Financial Disclosures (TCFD), call for scenario-base predictive risk assessments, but without a common underlying model, investors will lack “apples-to-apples” company scenarios.
  6. A wide range of players worldwide are working on certain aspects of these problems, but efforts are highly fragmented and often compete against one another.

Huge Gaps

Beyond listed equities in OECD countries, investors lack both insight about climate risk / opportunities and high quality investment vehicles.

Especially outside the OECD, countries lack tools & capital for both mitigation & resilience.