Physical Risk & Resilience Tool
The Situation: The Challenge of Measuring Physical Risk
As climate risk has become more widespread and forecastable, financial institutions such as banks and asset managers need to embed this risk into their end to end risk management frameworks. Such implementation requires new or amended tooling which will highlight areas/assets at risk and facilitate resilience planning & credit analysis.
One major challenge is that there is no common language on the use of climate models within financial institutions and no mature methodology for inferring the physical risk vulnerability on assets and hence the associated credit risk.
The Solution: OS-Climate Open Source Collaboration
The Physical Risk Workstream has been formed within OS-C in order to construct open source tooling for physical climate risk and resilience. The objective is a transparent plug and play platform where a community of users can contribute to (and utilize) models for the common good. The objective is to have all hazard models in one place and to apply them in a common way which can help create consensus on risk and put on a path to tackle resilience on a large scale. In conjunction with this work, the Data Commons will be leveraged in order to assist with the significant data required to identify and understand the risk.