Do you need to assess impact of climate change on your portfolios?
Translate complex climate scenarios into drivers of financial performance and carry out counterparty and portfolio-level analysis for thousands of companies across multiple sectors.
Climate Credit Analytics, developed by S&P Global Market Intelligence and Oliver Wyman, combines S&P Global Market Intelligence’s data resources and credit analytics capabilities with Oliver Wyman’s climate scenario and stress-testing expertise. Through a highly dynamic, sector-specific approach, Climate Credit Analytics enables counterparty- and portfolio-level analysis of climate-related financial and credit risks for thousands of companies across multiple sectors. This service facilitates an in-depth assessment of the impact posed by climate-induced transition and physical risks on portfolios.
Climate Credit Analytics translates climate scenarios into financial performance drivers, tailored to each industry. These drivers, which include production volumes, fuel costs, and capex spending, are utilized to project comprehensive financial statements for companies under various climate scenarios. These scenarios encompass those published by the Network for Greening the Financial System (NGFS), key regulatory scenarios, and short-term carbon-tax adjusted scenarios.
This enables users to have comprehensive and consistent modeling covering more than 140 industries under the Global Industry Classification Standard (GICS) code. The modeling uses a product-specific approach for high-carbon emitting sectors, such as oil and gas, power generation, metals and mining, and airlines. It also includes an emissions-based approach for construction, steel, agriculture, and other remaining non-financial sectors. Additionally, a top-down approach is available for name-based extrapolation for full portfolio coverage, when necessary.
The robust suite of tools leverages S&P Global Market Intelligence’s proprietary datasets and capabilities. This includes financial and industry-specific data from across divisions of S&P Global, sophisticated quantitative credit scoring methodologies, and emissions and physical asset risk data from S&P Global Sustainable1. All of these elements enrich the analysis and provide granularity to the approach. The offering enables automated bottom-up analysis for 2.2 million companies. For users who have the requisite information on their portfolio companies, a capability for proprietary analysis is also available.
Exhibit: Market-leading approach— Climate Credit Analytics
Climate Credit Analytics is designed to:
It also enables users to access a wide range of scenarios, with options for: