Project Introduction
Our team of graduate consultants is presently working with an asset management firm overseeing assets worth over $650 billion distributed across 51 locations spanning 25 countries. The first phase of the project was to analyze the most prevalent physical climate risks on the firm’s investment portfolio. From our research, we have identified five prevalent physical climate risks which are most relevant to firm’s investment portfolio, and a few sectors that are most at risk. Our next stop would involve creating an inventor framework to help investors understand physical climate risk.
Interim Presentation with Client
We had our interim client presentation just before the spring break, the equity investors were also in attendance for the meeting. The investors were generally appreciative of the information we had presented and had some suggestions as to how we can streamline our approach going forward. Some of the feedback included focusing on certain geographical areas, and a framework that could be uniformly applied to all sectors. However, given the tight timeline of the project it may not be possible to incorporate all of the feedback. The meeting was an enlightening experience, particularly for someone like me who does not have a lot of experience in impact investing.
Takeaways from Client Meeting
One of the key takeaways from the meeting was that we were able to streamline the project a bit more based on the feedback not just from the client POC but also from the investors. Secondly, we were able to better understand how the end users of the investing tool would like it to be framed. Finally, it gives us a lot of confidence as a team after having presented to the investors themselves.
Project Challenges & Journey Ahead
One of the challenges that we have faced so far is in being able to justify our findings with quantifiable data, as there is a lack of openly available data. Most of our research is backed by secondary data. Additionally, some of the research frameworks contradict each other, mainly because of the differences in methodology. Looking ahead, we would like to take a more centralized approach. Impact Investing I am feeling a lot more confident and more well versed with impact investing. Apart from a skill building perspective, I am generally feeling a lot more confident interacting with clients, and investors.