乐鱼(Leyu)体育官网

Industries

Helping clients meet their business challenges begins with an in-depth understanding of the industries in which they work. That鈥檚 why 乐鱼(Leyu)体育官网 LLP established its industry-driven structure. In fact, 乐鱼(Leyu)体育官网 LLP was the first of the Big Four firms to organize itself along the same industry lines as clients.

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We bring together passionate problem-solvers, innovative technologies, and full-service capabilities to create opportunity with every insight.

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Careers & Culture

What is culture? Culture is how we do things around here. It is the combination of a predominant mindset, actions (both big and small) that we all commit to every day, and the underlying processes, programs and systems supporting how work gets done.

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Climate risk & resilience

Weathering unprecedented challenges and realizing even bigger opportunities

ship moving through water

Climate change is reshaping industries. Real assets and infrastructure are threatened by extreme weather. Financial firms face rising loan risks. Energy companies must adapt to a low carbon economy. But challenges like these present opportunities鈥攊f companies position themselves to adapt and lead. 乐鱼(Leyu)体育官网 provides a comprehensive offering to help companies understand their unique climate risks, harden their organization against risks, and implement a strategy to realize opportunities.

Climate change is disrupting business as usual

Opportunities

Global sustainable investments may total听 US$53 trillion by 20252

  • new markets and assets
  • alternative energy sources
  • resource efficiency
  • new products and services
  • infrastructure and supply chain resilience

Risks

If global temperatures risk above 3掳C by 2050, global GDP could decrease by over 18%1. Physical and transition risks include:

  • extreme weather events
  • chronic climate changes
  • shifting consumer preferences
  • increased regulation and expanded carbon markets
  • talent and reputational risks
  • technological disruption

Footnotes

1 Swiss Re Institute, 鈥淭he economics of climate change: no action not an option鈥� (April, 2021).

2 Bloomberg, 鈥淓SG assets may hit $53 trillion by 2025, a third of global AUM" (February 2021)

The Taskforce for Climate-related Financial Disclosures (TCFD) provides a framework for assessing risks and opportunities

Governance: Disclose the organization's governance around climate-related risks and opportunities

厂迟谤补迟别驳测:听Disclose the actual and potential impacts of climate-related risks and opportunities on the organization鈥檚 business, strategy, and financial planning

Risk management:听Disclose the process used by the organization to identify, assess, and manage climate-related risks

Metrics and targets:听Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities

Source: FSB, 鈥�2021 Status Report: Task Force on Climate-related Financial Disclosures鈥� (October 2021)

乐鱼(Leyu)体育官网 offers an integrated process to help you better understand your company鈥檚 climate risks and drive solutions鈥攊n alignment with TCFD.

Climate risk assessment, impact analysis, and resilience strategy

  1. Evaluate TCFD alignment:听Assess current state disclosures in relation to the TCFD reporting requirements
  2. Assess climate risk:听Assess physical and transition risk exposure and identify areas of opportunities related to climate change using scenario analysis.听
  3. Develop climate action plan:听Develop an action plan to address climate risks and opportunities and refine TCFD reporting

The following three climate scenarios will form the basis for further risk analysis:

VERY AGGRESSIVE MITIGATIONSOME MITIGATIONBUSINESS AS USUAL SCENARIO


Emissions start declining by 2020

Likely not to exceed 2掳C

RCP 2.6


Emissions rise till 2080 then fall.听

Expected 3掳C-4掳C

RCP 6.0


Emissions continue to rise at current rates

Likely not to exceed 4掳C

RCP 8.5

Climate policies and regulationsHigh efforts to curb emissions via听regulatory changesMedium听efforts to curb emissions as global climate policy and pricing is听fragmented

Low efforts to curb emissions

Market preferences

Market preferences rapidly shift away from fossil fuels to renewables

Moderate shift away from fossil fuels

Few/Minimal shifts in market demand

Changes in weather patterns

Chance of extreme weather increase is lowChance听of extreme weather increase is moderate

Chance of extreme weather increase is high

Technological ChangesTechnology oriented towards sustainable developmentEnergy mix, with fossil fuels modestly reduced to half of the world鈥檚 power generation to include renewables

Fossil fuel continues to generate most of the world鈥檚 energy

Climate adaptation

Low environmental impact and low cost of climate adaptation needed

Climate adaptation required at a medium level and cost

Climate听adaptation required at a high level and cost

See how we helped a听global asset manager听embed a comprehensive strategy to manage climate risks and opportunities.

Understanding transition risks

Businesses need robust tools to quantify their climate-related transition risks and associated potential financial impacts. Using a variety of climate scenarios and integrated climate-economic assessment models, we help our clients strategically map out risks and opportunities (e.g., changes in energy and carbon prices around the globe, growth rates of economies). The underlying principles and methods embodied in this tool align with guidelines outlined by the Task Force on Climate-Related Financial Disclosures (TCFD), helping our clients meet internationally-accepted criteria. Our clients can explore potential risks and opportunities in the short- and long-term, focusing on transition risk as they move towards a low-carbon emission future.

Example: Price of carbon by year and scenario

NDC = Nationally determined contributions

Quantifying economic impacts

Understanding climate-related risks and opportunities require financial analyses that can incorporate various climate scenarios and business plans. The 乐鱼(Leyu)体育官网听听tool allows our clients to assess their portfolios and quantify the potential financial impact of such physical and transition risks as well as opportunities using principles of economics, finance, and enterprise risk management. 乐鱼(Leyu)体育官网 Climate IQ methodology is streamlined and automated generating financial estimates that provide the forward-looking information to help with strategic capital planning as expected by boards and investors and outlined by the Task Force on Climate-Related Financial Disclosures (TCFD).*

*乐鱼(Leyu)体育官网 Climate IQ is approved by and delivered in collaboration with 乐鱼(Leyu)体育官网 UK

Assessing physical climate risks

The other critical element of a sustainable decarbonization plan is assessing potential climate-related risks in your portfolio. 乐鱼(Leyu)体育官网 partners with third parties to help quantify financial impacts of property damage and business interruption on a site-level basis. This helps your organization to quickly and simply identify major risks鈥攂oth by type and magnitude鈥攁nd how these can be integrated into future risk mitigation plans. Our tools are supported by over $5 million of climate data.

Asset-level assessment | Asset exposure example

Identify key trends within individual assets to understand where attention is needed to mitigate climate peril impact

  • Asset location:听Baltimore, MD
  • Asset type:听Manufactured housing
  • Overall risk:听Top 5% of all assets
  • RCP scenario:听Low
  • Forecast year:听2030
  • Greatest risk factors:听Water stress, flood

Risk-level assessment | Portfolio exposure example

Aggregate groups of assets with like characteristics to provide climate risk and/or portfolio-level insights

  • Risk factor:听Wildfire (top 10%)
  • RCP scenario:听High
  • Forecast year:听2050
  • Assets at risk:听24 / 565 (4%)
  • Asset types:听Manufactured housing
  • Value at risk:听$538,568

Dive into our thinking

Climate risk and resilience

Weathering unprecedented challenges鈥攔ealizing even bigger opportunities

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Image of Erkan Erdem
Erkan Erdem
Principal, Economic & Valuation Services, 乐鱼(Leyu)体育官网 US
Image of Adam Levy
Adam Levy
Principal, Modeling & Valuation, 乐鱼(Leyu)体育官网 LLP

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