ESG Investor’s weekly round-up of news on technology and tools in the sustainable investing sector, including SDI AOP, UBS, Climeworks, AXA, Moody’s RMS, Fathom, Reask, Carbon Direct, Genpact and Climate Vault.
The Sustainable Development Investments Asset Owner Platform (SDI AOP) has enhanced its dataset to include information on corporates’ negative contributions to the UN Sustainable Development Goals (SDGs). Used by asset owners and managers to assess investee firms’ alignment with UN SDGs, the SDI AOP dataset now identifies revenues generated by products and services defined as inconsistent with achieving the global goals. “Adding negative contribution data is the direct result of regular exchanges with our subscribers. As this community is growing, we are integrating their feedback into the development of the data,” said James Leaton, Research Director, SDI AOP. Leaton cited single use plastic packaging as an example of a negative contribution, as it is not consistent with UN SDG 12 on responsible consumption and production and is the primary contributor to marine plastic pollution under UN SDG 14. SDI AOP helps investors to embed the UN SDGs into their investment processes and integrate SDG contributions into their portfolio management and reporting, enabling target setting and progress monitoring. The new release also includes methodology enhancements and additional data granularity. Future data releases will be quarterly, starting in December. The platform is operated by asset owners APG, AustralianSuper, British Columbia Investment Management Corporation and PGGM, and its underlying data is available to the market through analytics and index provider Qontigo.
Swiss bank UBS has signed a ten-year agreement with Climeworks, a provider of CO2 removal through direct air capture. Climeworks, clients of which also include Stripe, Klarna, and Square, recently announced the launch of its next direct air capture and storage facility, called Mammoth. “Sustainability continues to be at the top of our clients’ agendas and, in order to be a credible partner, it is important that we demonstrate our continued commitment when it comes to the sustainability of our own business activities,” said Sabine Keller-Busse, President UBS Switzerland. In its most recent report, the Intergovernmental Panel on Climate Change estimated that by mid-century, 3-12 billion tons of CO2 will need to be removed from the air every year in order to limit global warming to 1.5°C.
AXA Climate, the arm of AXA Group specialising in climate change adaption, will include HWind analytics from Moody’s RMS unit as a trigger metric for its relevant parametric insurance policies. HWind produces real-time data for tropic cyclone events, allowing for a “quick evaluation of hurricane trigger or pay-out conditions”. This enables parametric policyholders across the Western North Atlantic, Eastern Pacific, and Central Pacific basins to gain rapid access to capital following impactful events. AXA Climate said using RMS HWind helps them to be fully flexible as to how and where they structure parametric policies, allowing reassurance for their clients that they will quickly receive the protection they paid for when damaging winds are present. Amaury Dufetel, AXA Climate’s Head of Insurance, said: “Data coming from independent reputable organisations like RMS HWind solutions will allow us to structure innovative parametric covers and bring to our clients the best tailor-made Tropical Cyclone coverage both in terms of price and claim settlement.”
Fathom, a global flood risk modelling business, and Australian science and technology company Reask have partnered to provide ESG-focused investors, banks and insurers with risk data on the combined impact of flood and wind events. The collaboration initially aims to enable each firm to sell the other’s products and services to new and existing clients. From 2023, the two companies aim to bring new hazard data maps and catastrophe risk models to market, covering the combined perils of flood and wind. Dr Andrew Smith, Fathom’s COO and Co-Founder, said: “This shared [transparent and open] approach [on data] means that risk professionals can understand the work our academics put in, and customers know they can trust our models.”
New York-based carbon management firm and software provider Carbon Direct has announced it has raised US$60 million which it intends to use to expand science-backed end-to-end carbon management. The funding round was led by Decarbonisation Partners, a partnership between Temasek, BlackRock and Quantum Energy Partners. The capital will be used to help enable more organisations to reduce their emissions and remove carbon from the atmosphere, continue investing in its science-based carbon management platform and apply its “science-first approach” while expanding its offerings. Jonathan Goldberg, Carbon Direct’s CEO, said: “Without scientific expertise, carbon commitments will have far less impact than they could. This investment will help us scale the work we are already performing for industry leading clients.”
Genpact, a New York-based IT services and consulting firm, and American non-profit Climate Vault have announced a partnership to aid in “rapidly accelerat[ing] towards a carbon-neutral future”. The partnership aims to combine Genpact’s digital transformation and technological expertise with Climate Vault’s “quantifiable, integrated” approach to carbon reduction and removal. Through the collaboration, Climate Vault will embed Genpact’s digital technologies and process expertise to boost its carbon reduction and removal solution. As a result, companies will gain wider access to carbon reduction from regulated carbon compliance markets with accurate, dynamic, real-time pricing, enabling greater access at scale to industry-leading and independently verified carbon removal programmes. Michael Greenstone, Climate Vault’s Co-Founder, said: “Together we will dramatically expand the reach, speed, and impact of our unique carbon reduction and removal solution, helping to slow and even reverse climate change.”
