The evolving landscape of big data analytics and ESG materiality mapping
Gopal, Sucharita; Pitts, Joshua; Inampudi, Kalyani; Xu, Yingqiang; Cook, Graham
Raging hurricanes, devastating floods, sea-level rise, heatwaves, and other extreme weather conditions are now attributed to climate change. The authors propose that climate change poses a significant investment risk in terms of economic losses and societal disruptions such as migration, infectious diseases, and increasing vulnerability of exposure to more frequently recurring weather events. They discuss optimum utilization of big data and data analytics along with artificial intelligence to assess the materiality of these potential risks in portfolios. Further, they highlight emerging and established approaches through two case studies to highlight how the overall investment management community can benchmark its exposure, risk, and vulnerabilities, coupled with future impacts and building resiliency, across portfolio management and investments.
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