The ClimateWise Transition Risk Framework provides an open-source, step-by-step methodology on how to manage the risks and capture emerging opportunities from the low carbon transition. Transition risks include market and technological shifts, policy and legal changes and reputational damage. The framework is designed to help investors assess the breadth of asset types exposed to transition risk at portfolio level, define the potential financial impact of the low carbon transition down to asset level and incorporate transition impacts into asset financial models.
The ClimateWise Physical Risk Framework demonstrates how the expertise and tools of the insurance industry can support other parts of the financial system to understand their physical risk exposure. Physical risks include rising temperatures, flooding, drought, sea level rise and water scarcity, of which associated financial losses (both insured and uninsured) have significantly increased in recent years. The framework offers real estate investors and lenders a means of understanding the potential physical risks of climate change on their portfolios.