RS Metrics has collaborated with Integrated Biodiversity Assessment Tool (IBAT) to launch asset-level biodiversity metrics for the firm’s ESGSignals platform.
IBAT, a platform which provides authoritative geographic information about global biodiversity combines three global biodiversity datasets, and when integrated into ESGSignals will allow users to make biodiversity-informed capital allocation decisions.
Asset managers and corporate clients will have access to ESGSignals to baseline and benchmark securities level exposure to over 265,000 protected areas, 142,000 IUCN Red List species, and over 16,000 key biodiversity areas.
The integration of asset-level biodiversity metrics will also help rating agencies incorporate quantitative assessments of a company’s biodiversity-related risks and opportunities, while index providers can create biodiversity indices based on objective datasets.
In addition, investors and other stakeholders will be able to answer questions such as:
“How exposed is a portfolio company’s oil pipeline capacity to physical risk, and in the event of a spill, what will be the impact on Red List species?”
“What are the outlier assets in a portfolio in terms of exposure to key biodiversity areas?”.
The collaboration follows the launch of the Taskforce on Nature Related Financial Disclosure (TNFD) framework which is expected to be adopted by governments, corporations and asset managers and will further the need for objective biodiversity datasets.
Maneesh Sagar, CEO of RS Metrics: “In our conversations with Wall Street analysts, we have noticed an increasing level of sophistication on climate, environmental, and physical risks.”
“There is growing awareness of how all the different elements of corporate environmental performance tie together,” said Sagar. “What this means is that the same beleaguered executives, who are just getting off their heels in responding to emissions, are increasingly having to answer a litany of questions on biodiversity, water stress, physical risk, etc.”
Sagar said that the pressure will only intensify due to what RS Metrics call “involuntary transparency” which is the ability to use geospatial to peer directly into corporate environmental performance.
“As the general public finds out how poorly environmental metrics are currently measured (very rough estimates for emissions, not at all for measures like biodiversity), public scrutiny will only intensify,” added Sagar.