London event showcases innovation behind new investor climate tool

Yesterday’s event, titled “Applying Climate Risk Data to Investment Portfolios”, convened environmental, financial and academic experts to discuss the project Climate Risks for Asset Managers (CRAMs), a collaboration between Carbon Delta and the Potsdam Institute for Climate Change Research (PIK). 

The CRAMs project will facilitate a global assessment of the financial impacts of climate change on corporations and their investable securities as well as real estate assets. CRAMs will be key in helping investors align themselves with the Paris climate goals. It relies on a unique climate risk metric developed by Carbon Delta – the Climate Value-at-Risk® (CVaR), which provides a forward-looking scenario analysis approach which identifies both risks and opportunities from climate change.

Carbon Delta CEO and co-founder, Oliver Marchand speaking at the London event said:

“We are extremely proud of the work that has been put into CRAMs, which will reshape the way people think about investment and the future of climate risk analysis”.

“This arrives at a time when countries around the world are realising the need for a more robust climate policy framework. CRAMs will introduce a new level of transparency in financial reporting to help businesses adapt to this framework, as well as meet investors’ growing demand for more sustainable assets”.

The aim is to transform how businesses and investors view sustainability risks alongside the future allocation of capital, including through new sets of climate data and a more accurate means of pricing carbon-based activities.

The event featured speakers from all three organisations to illustrate the thinking behind CRAMs and how they mapped climate risks to companies and their listed securities. Panellists such as Professor Hans Joachim Schellnhuber CBE and Jean-Francois Coppenolle from Aviva Investors were also on hand to share their own experiences with climate scenario methodologies, noting the immense challenge of addressing a growing risk that is often difficult to quantify.

Carbon Delta co-founder and Project Leader David Lunsford said:

“From the EU, to Asia and even the US, we are witnessing a fundamental transition in the investment community towards climate resilience”, said He also added that “the CRAMs project marks a significant step in this direction – no longer will lack of information be the reason for not investing in sustainability”.

The CRAMS project was supported by the by EIT Climate-KIC, Europe’s leading climate innovation initiative. EIT Climate-KIC, Head of Programmes, Mission Finance Riyong Kim said:

“EIT Climate-KIC has supported Carbon Delta and Potsdam Institute to grow the CRAMs project into a solution that brings risk to the forefront and to the attention of the financial industry for disclosure and action. This is essential in minimising and managing the impacts of climate change on investment portfolios and in upholding responsibility towards investors”.

Carbon Delta co-founder and Project Leader David Lunsford thanked EIT Climate-KIC: “EIT Climate-KIC was an indispensable partner for Carbon Delta from the very beginning of the Climate Risks for Asset Managers Project. They provided us with their expertise, knowledge and financial support which enabled the CRAMS project to become market ready and begin to scale so effectively.”

For more information about the CRAMS project, please read the press release on the Carbon Delta website and visit the Mission Finance page on our website.