Scenario and Resilience Analyses
Use scenarios and ensure resilience
The pressure from the market, regulators and stakeholders to understand the opportunities and risks of climate change for portfolios, business models and assets is constantly increasing for banks, insurers and asset managers. Physical risks such as floods, storms or heatwaves as well as transitory risks due to CO₂ pricing, stricter regulation or changes in capital flows are increasingly influencing credit risks, loss ratios, investment portfolios and strategic capital allocation. Climate-related scenario analyses are therefore becoming increasingly important as a key instrument for ensuring portfolio stability, resilience and long-term value creation.
At the same time, regulatory requirements are becoming stricter due to CSRD, EBA and EIOPA guidelines and international frameworks such as TCFD, IFRS-S, PRI and PRB. The systematic analysis, management and disclosure of climate-related risks is therefore not only a regulatory obligation, but increasingly also a competitive factor. agradblue supports financial institutions in establishing and permanently anchoring climate scenario analyses in portfolio management. We provide a sound understanding of relevant climate and energy scenarios, sector-specific risk and opportunity drivers and their transfer to traditional risk types and financial ratios. Our analyses are based on recognized, publicly accessible sources such as the IPCC, NGFS and IEA as well as on recommendations from financial market supervisory authorities and guarantee reliable, comparable results. If required, we also support our clients as independent consultants in the selection and introduction of suitable software solutions for carrying out climate scenario analyses.
Our expertise
agradblue has already supported a large number of banks, insurers and asset managers in the implementation of scenario analyses and is familiar with the challenges of integrating them into existing risk, credit and investment processes. We will guide you through the world of scenarios and how you can use them for effective management.
Our services include:
- Conducting qualitative and quantitative scenario and resilience analyses at company level
- Calculation of the so-called anticipated financial effects
- Methodological training and project implementation in a sparring approach
- Business area analyses and derivation of possible adjustment measures
- Reporting in accordance with CSRD, EU taxonomy and TCFD/TNFD and IFRS as well as for supervisory authorities
- Support in software selection processes
- Classification and evaluation of best practice methods available on the market for measuring climate risks and opportunities
- Developing a deep understanding of scenarios and the associated uncertainties
- Integration of ESG risks into all relevant business processes
For banks:
- Sparring for the stress test
- EBA fitness check
- Project coordination in coordination between front office, back office, central functions and risk management