29 September 2022

Arjun Infrastructure Partners announce partnership with Cervest to offer institutional investors enhanced adaptation and mitigation planning solutions


By Cervest

Arjun Infrastructure Partners announce partnership with Cervest to offer institutional investors enhanced adaptation and mitigation planning solutions

Addition of Cervest climate intelligence to Arjun’s customized solutions adds capability to quantify climate-related physical risk on infrastructure assets

LONDON – 29 September, 2022 European asset manager Arjun Infrastructure Partners (Arjun) has today announced a partnership with climate intelligence (CI) company Cervest.

Arjun will use Cervest’s climate intelligence to assess climate-related physical risk on clients’ infrastructure assets and portfolios. Physical risk quantification is critical to climate resilience planning and necessary to meet reporting requirements for climate-related financial disclosure, which became mandatory in the UK in April 2022. Similar regulations are expected in Europe and the U.S.

Climate intelligence (CI), which analyst firm IDC calls a ”strategic priority for businesses”, is business intelligence for managing climate risk at asset-level. This includes assets owned and managed by a company, as well as those it relies on for operational and supply chain continuity. Cervest CI, delivered through its EarthScan™ product, provides unprecedented clarity about how climate risk may impact physical assets, including data centers, airports, biomass facilities, water companies and motorway services areas– now and in the future.

The addition of EarthScan climate risk insights into Arjun’s analysis capabilities is fundamental to helping institutional investors secure stable, long-term financial returns. This is particularly important for infrastructure assets, as they are physically tied to specific locations and typically require a long-term investment strategy.

Rhyadd Keaney-Watkins, Head of ESG at Arjun Infrastructure Partners, said: “Using Cervest’s climate intelligence we are able to harness climate science from a range of leading sources, across multiple climate scenarios and time horizons, to derive decision-useful insights. With these insights to hand, we can challenge management teams on a variety of topics, including operability and expenditure risk in the event of increasing climate volatility”.

The economic impact of climate volatility and increasing government regulation are driving businesses to better manage their climate risk. Globally, climate change puts financial assets worth an estimated USD$2.5 trillion at risk. Regulations requiring the UK’s largest companies and financial institutions to report about the impact of climate change on their business, in line with recommendations from the Task Force on Climate-Related Financial Disclosures (TCFD), take effect in April.

Cervest’s CI will enable Arjun to quantify the climate risk exposure of their clients’ managed assets and use these insights to comply with Disclosure reporting requirements, support due diligence assessments, and develop financial resilience strategies.

“For instance, EarthScan’s extreme temperature metric may indicate a potential rise of 3˚C during heat waves. We can then use these insights to stress test the operation of assets and identify potential investments that are needed to improve resilience. With that information we can drive improvements, reduce risk, and protect client returns,” added Keaney-Watkins.

Without climate intelligence, decision-makers face a major challenge to accurately discover, analyze, and act on the climate risks and opportunities facing their assets. Cervest’s CI offers a unified, comprehensive picture of climate-related risk to assets, allowing them to pinpoint risks and opportunities across their portfolio quickly and report in close to real-time. Insights are available simultaneously on risk hazards, such as heat stress, flooding (coastal and riverine) drought, wind and precipitation, across multiple IPCC-aligned climate scenarios, backwards in time to 1970 and ahead to 2100 at five-year time steps.

“CI provides the new climate literacy every decision-maker needs to plan, fund and build our critical infrastructure and protect our most valuable assets.Together, Cervest and Arjun Infrastructure Partners will help institutional investors factor climate risk into key investment decisions and meet climate-related financial disclosure deadlines," says Iggy Bassi, Founder and CEO of Cervest.

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