Investors faced with the proliferation of climate-financial communication

The Paris agreements and the European commitment to carbon neutrality call on all financial and non-financial actors to strategically integrate climate issues. As a key player in the investment chain, the financial industry is particularly expected to create the conditions for an orderly reorientation of capital flows necessary for a successful transition.

Pledges to take action on climate change have accelerated significantly in the last three years, notably as a result of the “Business Ambition for 1.5 degrees: our only future” and “Glasgow Financial Alliance for Net Zero” initiatives: more than 700 non-financial companies and more than 450 financial companies, responsible for the management of $130 trillion, can now claim to be Net-Zero committed.

In the interest of investors, European (Taxonomy, SFDR, CSRD) and national (Article 29 of the Climate-Energy Law) regulations are progressively being strengthened, specifying analysis frameworks and transparency obligations. Aware of the difficulties of implementation, major prescribers of good practice have recently published operational guides on both alignment methodologies (TCFD-PAT) and climate stress tests (NGFS).

The objective of this seminar is to assess the extent to which these developments respond to the widely recognised need for a certain amount of guidance on the methodologies that are proliferating on both dimensions of materiality – environmental and financial – in order to ensure their quality and comparability.

Do the guidelines now available offer a good compromise between the twofold need for a common grammar and the need for flexibility in dealing with the many difficulties that cannot be resolved by predetermined answers? Do they provide sufficient incentives for issuers to improve their strategies and reporting? Do they make it easier for portfolio managers to develop products that are Net-Zero aligned or that optimise exposure to climate risks and opportunities?

 

General introduction: Stéphane Voisin (ILB): 15mn

 

First Round Table: towards a convergence of alignment methodologies?

Guiding questions:

• Beyond their marketing role for service providers, are alignment methodologies also used to guide strategic choices?
• How can alignment results be better presented to facilitate comparisons and understand the divergences and complementarities between the different approaches?
• Will existing or pending regulations and voluntary recommendations be sufficient to reduce methodological divergences to a reasonable level?
• What are the main levers for improving the quality and comparability of alignment methodologies in the medium term?

 

Moderator: Elisabeth Bertin (Group Strategy Department, EDF)

• Accelerated integration of sustainability issues under the ESG reporting premium: Eliza Mahdavy (ESG Manager, EDF): 15mn
• Overview of climate assessment approaches: Julie Raynaud (ILB) : 15mn
• Point of view of an ESG analysis, index and rating company: Sylvain Vanston (MSCI) : 15mn
• Example of a tool for implementing a net zero portfolio investment strategy: Frédéric Samama (S&P Global) : 15mn

 

Discussion: 30mn

Coffee break: 15 mn

 

Second Round Table: Towards a convergence of climate risk and opportunity analysis?

Guiding questions:

• What are the main approaches to climate risk and opportunity analysis used to assess financial and non-financial actors? How are they integrated into traditional methods of purely financial risk analysis?
• How are climate, macroeconomic and financial models linked? How can we ensure the quality of the representation of climate-financial risks and impact measures?
• To what extent can the NGFS approach be used by non-financial companies?
• What lessons can be learned from the assessment approaches and climate stress tests carried out to date for financial and non-financial actors?

 

Moderator: Thomas Allen (Banque de France)

• Climate models and scenarios for financial supervision: Peter Tankov (ILB): 15mn
• Articulation of the different models used for climate stress tests: Frédéric Ghersi, (CIRED): 15mn
• Challenges of the implementation of climate risk and opportunity analysis by non-financial companies: Rémi Bussac (Direction Impact, EDF) : 15mn
• Experience of a long-term portfolio analyst: Jean-Marc Lefeuvre (ALM Division, EDF) : 15mn

 

Discussion: 30mn

 

REGISTRATION

Organisers:
EDF
ILB