Global advisory, broking and solutions company Willis Towers Watson announced today the transfer of the Climate Policy Initiative’s (CPI) Energy Finance team to the firm’s Climate and Resilience Hub. The transfer includes the team’s Climate Value at Risk (CVaR) methodology, data and modelling tools, designed to deliver low carbon transition analytics to financial institutions, corporates and public sector clients.

CPI is an analysis and advisory organization with deep expertise in finance and policy, with a mission to help governments, businesses, and financial institutions drive economic growth while addressing climate change. The Energy Finance team includes economists, analysts, and financial and energy industry professionals, developing innovative finance and market solutions to accelerate the energy transition.

Willis Towers Watson’s Climate and Resilience Hub is the focal point for the firm’s climate expertise and capabilities, delivering analytics, advice and transactions to corporate, finance and public sector institutions. The firm stated that the addition of CPI Energy Finance’s low carbon analytics, expertise and relationships will enable Willis Towers Watson to help organisations assess their market exposure to a low carbon transition process.

Today’s announcement marks another step in Willis Towers Watsons investment in expanding the skillsets and capabilities of the Climate and Resilience Hub. In November, the firm announced the acquisition of climate change adaptation advisory and analytics services provider Acclimatise, adding a unique platform to assimilate and apply climate model and earth observation data to support risk analytics and on-line applications.

John Haley, CEO, Willis Towers Watson, said:

“Following our recent acquisition of Acclimatise, we are delighted to welcome the Energy Finance team from CPI into our Climate and Resilience Hub. Measuring the impact on investments of the transition to a low carbon economy and developing new financial products to price risk and support the efficient allocation of capital is essential for an orderly and well-managed transition. Today’s announcement is part of our ongoing strategy of investing in skillsets and world class data and analytics to support our clients in forming a strategic response to climate change.”

David Nelson, Executive Director at CPI Energy Finance, said:

“Over the last decade our work has shown that risk and uncertainty surrounding the financial impacts of a climate transition are possibly the greatest impediments to mitigating climate change. Our granular, asset-level models evaluate these risks by focusing on how financial markets would value resources, assets, businesses, tax revenues, and sovereign credit ratings as a result of climate transition driven changes to consumption, industry structure, and the global economy.

“We see no better way to scale and expand our offering than working with a world leader in risk management such as Willis Towers Watson and its exciting and growing Climate and Resilience Hub. We are delighted that they have recognized our expertise in identifying and quantifying the climate-related financial upside and downside risks of the transition and are looking forward to working with Willis Towers Watson in offering support analytics, advisory and transactions services, and Climate Value at Risk assessments and tools for companies, investors, public and private financial institutions, and governments.”

Willis Towers Watson also announced that Professor Tom Heller, Chairman of CPI’s board, will join Willis Towers Watson as a strategic adviser. Heller said:

“Accounting well for the growing impacts of climate transition risk has become one of the most important governance issues for sovereigns, central banks, financial institutions and corporates around the world. And it will only become more pressing as the pace of policy reform, technology innovation and public sentiment accelerate, and asset prices adjust.

“Synergies in expertise between Willis Towers Watson’s Climate and Resilience Hub, CPI Energy Finance, and the new team at Acclimatise provide a significant opportunity for countries and firms to plan for orderly, efficient and fair transitions to more sustainable and productive economies, combining advances in analytical metrics with targeted financial instruments, insurance products and investment strategies to manage the physical and financial risks associated with climate change.”