Use Case Financial
ESG CSRD
Our client a public financial institution committed to combating poverty and promoting sustainable development. Our mission involved building an ESG reputation score for their investment portfolio, based on our existing solution, integrating both media/public perception and sustainability reports. The main objective was to provide the client with tools to improve their investment strategies by identifying risks and opportunities related to ESG criteria, supporting sustainable growth and the institution’s reputation management.
Challenges
Integrating media with ESG reports
Consistent integration of media perceptions with often disparate and unstructured ESG reports.
Extracting data for small companies
Extracting high-quality data for small companies with limited reports and scarce media mentions.
Ensuring ESG score traceability
Traceability and audit of the calculated scores.
Solution
ESG Reputation Analysis: Based on CSRD reports and a reference framework, we defined scores for each pillar.
Methodologies for ESG Criteria: We applied suitable methodologies to generate and preserve sustainable and profitable portfolio outcomes.
Regulatory Publications & Climate Change Alignment: We assessed CRR2 model requirements and filled data gaps, particularly regarding new requirements. We ensured compliance with EBA regulations via the CRR2 reporting framework.
Economic Impact of Climate Change: We quantified physical risks and transition risks and their impact on financial institutions’ operations. We anticipated potential climate-related damages to businesses and countermeasures to manage these risks.
Tech stack
Results
We developed an ESG scoring system for a segment of the AFD’s investment portfolio, enabling the generation of detailed scores based on various sub-themes and specific ESG indicators. This system provides a comprehensive evaluation of investments, allowing the AFD to assess ESG performance across multiple dimensions and make more informed decisions aligned with sustainability goals.
