This message is brought to you by Apple Card. Apple Card members can earn unlimited daily cashback on everyday purchases wherever they shop. This means you could be earning daily cash on just about anything, like a slice of pizza from your local pizza place, or a latte from the corner coffee shop. Apply for Apple Card and the wallet app to see your credit limit offer in minutes. Subject to credit approval, Apple Card issued by Goldman Sachs Bank USA Salt Lake City Branch, terms and more at Applecard.com. This is Tom Runes' Reese and you're listening to Switched On, the podcast brought to you by Bloomberg NUF. Nature Risk is emerging as one of the most complex and least understood challenges facing companies today. Unlike climate which can be measured through a single global metric, nature-related risks span everything from water and biodiversity to waste and pollution and play out very differently across sectors and geographies. Bloomberg's new Nature Risk Management scores attempt to bring structure to that complexity, combining company exposure with the actions taken to manage those risks. The results reveal a striking disconnect. Firms with the highest exposure are not necessarily those doing the most to mitigate it, and while progress on climate and waste is relatively advanced, engagement on water and biodiversity still lags. So, how do you measure something as diffuse as nature-risk? And what do those scores tell us about which companies are best prepared? On today's show I'm joined by Alistair Pherde, a senior associate from a Nature and Biodeiversity team to discuss findings from his note, Managing Nature Risk, Company League Tables. BNF clients can find this note and other Nature and Biodeiversity research by heading to BNF Go on the Bloomberg terminal or BNF.com. If you'd like to learn more about how BNF approaches strategy research on the energy transition, including developments in commodity markets, trends across different sectors and the cross-cutting technology shaping the future, you can find more information on BNF.com. And if you'd like to speak with a member of our team about becoming a client, email us at
[email protected] But for now, let's take a closer look at the League Tables and how the scores come together. [Music] Hi Alistair, welcome to the podcast. Hey Tom, nice to be back. Thank you for having me. So, let's start right at the beginning. Because here we talk about Nature Risk. And when you say those words, like all sorts of things come to mind, I mean, on one extreme, you. I have pictures of situations like the day of the Trifids, where the plants come and take over. I'm presuming that's not in scope for the work you've been doing. But also, because it is such a broad concept, can you talk about what we are talking about? And in a way, like, what sits inside and outside of Nature Risk? Like, because I know we've had people on the podcast, for example, to mount climate risk. Climate risk is subset of nature risk, or is it something that stands alongside it? They're very trying to try and guess what nature risk is. Why not just let you tell me what nature is? Sure, sure. Of course, we've got a cover dish at the top of the show. And your point on Trifids is relevant, because a part of Nature-related risk is about invasive alien species. But this is less relevant to some of the companies that we'll be discussing today. So yeah, I'm sure almost the entirety of the audience will be familiar with nature as a concept in that it's anything non-artificial. This comprises living things such as plants, animals, bacteria, and so on. As well as non-living things, so that's materials, water, and the atmosphere. And that atmospheric component links closely to what you said about the relationship between climate risk and nature risk. Climate risk is a subset of broader nature risk. All economic activity essentially interacts with nature to some extent and does so in two different ways. Firstly, it depends on natural assets. So natural assets are any of these living or non-living things from which we derive ecosystem services that a series of benefits just taken from nature. There's a range of different dependencies that we may have. For example, a mining company extracts materials from the ground. That's known as resource extraction. A food company might also extract materials. It requires pollination for crops that then become ingredients. It needs water and so on. A financial data services company such as ours requires energy, water. It requires a stable ground on which to build paper. A whole range of different things that come from nature. Now if these underlying natural resources or ecosystem services are jeopardized, so too are the company cash flows. And ultimately the returns of investors and financiers. At the same time, however, the companies through their operations impact the natural environment and these natural assets that we were just talking about. We can also understand this as an economy shaped by a variety of different regulations, policies, consumer and market expectations, and emerging new technologies. Whenever these things change, then we also have a threat presented to company cash flows. Now these two forms of risk, as you know from our guests on this podcast talking about climate, are known as physical risk, where you are dependent on a natural asset that might get damaged and transition risk when the regulations and market expectations shift. So nature covering a variety of issues manifests through changes in physical and transition risk. So this kind of notion of nature risk. I mean, in a certain sense, it has always existed. You know, to your point, all the economic activity and I'm assuming this goes through the centuries as well has interacted with nature. But I'm pretty sure you know back in Elizabethan times there wasn't an analyst doing nature risk. Or maybe there was, I mean, has this is this a new thing? Or is it something that's always been a consideration, but it's kind of evolved into its current form? There would even in a like Victorian times there would have been an analyst assessing say the stack of timber that's available for a paper producer. But it's just it recently over the last five or six years we've seen it codify differently. And it's when financial institutions start to take risk and see this as a natural financial risk both to their loan books or equity portfolios that it's become much more of a real thing rather than like a conceptual tangential thing that people have considered just to let say look good. Now it's considered as alongside climate as classic risk. I mean, the reason I asked my question is you know, I was just trying to understand them in. And the example use of the sort of the Victorian paper mill in the woods is a good one. In that there was a very specific dependency to a specific business model and their operations. And so of course they were considering that. But where I was really coming from is our nature risks now compared to say that example. Are they recognized as much more universal impacting a much broader range of companies in a lot of ways? Less directly related to just the local environment but the broader environment. And are they much more severe and is that why it's getting codified in a more serious way? Yeah, very much so. So if we look back 200 years or even a hundred years ago production was much more localized. But now that we have global supply chains particularly for the largest of companies, we see a complex where both dependency and indeed impact and these are spread globally. So if you're a conglomerate producing a wide range of different products, and you source from countries all over the world. And as for the extent of that risk or the scale of it, it is becoming more severe. We see changing climate, impacting the stability and availability of many different natural resources. I'm sure every audience member here has sort of water stress, like difficulties for economic activities that depend on some form of fresh water or salt water. We've seen an unprecedented decline in the amount of biodiversity, which impacts the stability and resilience of many biophysical systems. It's a broad range of issues that are becoming more and more at risk that impacts global company operations. And so that's why it's become much more of an issue for many in the financial sector and as well as many large corporates. So I hear you on the, just that the risks are more severe inherently. And then because of the very interconnected way, global economy works, they are much more wide-ranging. But to that latter point, I also imagine for you as someone who analyzes this stuff, it makes it a lot more complicated to analyze, which kind of leads me to asking about the work you've been doing. So you've published scores rating different organizations on their preparedness for nature risk. Can you tell us a little bit more about that work? Yeah, absolutely. And one of the things that readers will note throughout this report is exactly what you're talking about. Nature risk is such a multifaceted threat, so many different issues feed into assessment of it. And so what we did was to, first of all, we designed, we determined a company universe. We chose seven sectors, most germane to be in our research, and chose the 30 largest companies within them by revenue. Then we determined what are the most salient, nature-related issues. And we chose four main ones and one supplemental one. The four main ones are just done because they conceptually make sense. We look at company performance on water, climate change, waste and pollution, and biodiversity as a topic. So each of those four components are the high level indicators of what companies are doing. And we also supplement it with reporting and disclosure. There's a market-led initiative that produces recommendations for companies to report and disclose impacts and dependencies, as well as analysis of risk and opportunity. And the scoring framework breaks down into two main pillars. We've got 30% of the score coming from exposure. So how much revenue is at risk from these impacts and dependencies that we talked about earlier? The remaining 70% or the majority of the score is company performance and interventions relating to these four high level topics. So based on approximately 65 Bloomberg terminal fields and some additional B&F research, we issue level scores that then roll up to a single number company score. The range is from 0 to 10, with the score of 0 meaning you're extraordinarily exposed to nature risk and you're doing absolutely nothing to mitigate it, whilst your interaction with nature is highly destructive. to 10, meaning the environment.
You have zero exposure and you're extraordinarily brilliant company doing everything to mitigate risk. So it's like 30% how much of this is a problem for you? 70% is what you're actually doing about it. Yes, exactly right. And I suppose when you're comparing two peers in the same industry, probably the 30% of how much of a problem this is, is probably quite similar. So that 70% is the real differentiation. Yeah, very much. And we found out across the seven sectors. So if you're especially if you're a large integrated company, you're likely to have exposure across the whole value chain, meaning that two such companies in practice will have similar risk exposure. So yeah, I think it's best to think of the exposure as more conceptual thing, what kind of industry you are operating, what kind of activities are you likely to be doing? Whereas the interventions are more real world, like what's your actual performance? What are you committing to? That's where you can find much more of a differentiation. So the scores are not particularly designed for intersector comparison, because there's so much peer comparison that feeds into the scores. Like it doesn't make too much sense to compare an upstream like oil producer with a with a Tesla, for example, because of their waste, their climate impacts will be so different. Yeah, I can definitely see that. And just to like further understand this, because obviously our economy impacts the environment and impacts nature and is driving a lot of these risks. I think it's fair to say that. And then in turn, the economy is exposed to these environmental risks. To what extent are we scoring companies on the first part of it, the degree to which they're contributing to the problem versus the degree to which they are exposed versus insulating themselves from the resulting challenges. You could, for example, I could imagine a company that has a really high emissions intensity and is therefore contributing to climate change. But actually it is very well protected from all of the physical risks it could potentially be exposed to. And so it's not going to be impacted by climate change in terms of its revenues. Like how would you score a company like that? So firstly, it's a multi stage process. So first, it's just pure conceptual exposure. How much is the risk likely to manifest? Then a secondary tier is what are the actual impacts on the company? So we take into account the emissions intensity. That's a fairly high percentage. It accounts for about 10% of the total climate score of the company. And then following that, there's a range of much smaller fields that feed in of secondary importance each of one or two percent each. So we look at, say, the company pledges for emissions reductions or energy efficiency policies. The use of carbon removals and carbon credits. Do they have a high level climate change policy? Do they assess climate change risks in their, in their, in their filings? Do they undertake climate scenario analysis? Do they have bored and executive level oversight of climate? All of these smaller fields are approximately equally weighted collectively to the actual impact of the company. The separate slightly lower, lower weighted score is the revenue exposure. So all of the things feed in and the materiality of each component reflects the impact, the actual effect that the company is having through its use of this policy or initiative. And to what extent it is actually damaging the environment. Apple Card members can earn unlimited daily cash back on everyday purchases or ever they shop. This means you could be earning daily cash on just about anything like a slice of pizza from your local pizza place or a latte from the corner coffee shop. I suppose, I mean, if I was to simplify what you're saying, because I remember at the start, you said it, you can divide it into physical risk and transition risk, which is the sort of changing of regulations. If you are damaging the environment, then you're highly at risk of regulations coming in and not being prepared for that change. If you're a highly destructive company, then you're exposed to both physical and transition risk. I would contend to be highly destructive. But it's also these impacts that will put you at risk will leave you open to transition risk. Got it. So I'm going to ask you about your findings. Before we dive into it, I think you mentioned that you looked at the sectors that I believe the word used was Jameh. Great word. The most germane to be any of. I'm going to try and find excuses to use that today. So what were those sectors? So yeah, we looked primarily at sectors where we have deep expertise at B&F, as well as the most destructive sectors, because they're the ones that present the greatest threat to the financial component of the economy, as well as the places where you can find the biggest opportunity for change. There's more to be done. So we looked at oil and gas, both upstream and downstream. We looked at the biggest metals and mining firms, as well as chemical firms. We looked at automakers covering both traditional ice vehicles and EVs. We looked at big technology firms spanning chip manufacturers, data centers, and other things. B&F classic power utilities and then one of B&F's new teams, the food and agriculture sector. So we've got a broad range of coverage to reflect the diversity of activities and there's also pretty broad geographical coverage here as well. So let's go on to your findings. I'm going to kind of preempt your answer by just making an observation that you condensed everything you're saying down into a score out of 10. And nobody got higher than a six. So I don't know if you're like the Simon Cowell of nature risk or what, but just tell us a little bit about that to start with. Sure. So we alluded to this like briefly before. It's almost impossible for a company to get an extremely high score, especially in the kind of sectors that we were looking at. Because if you remember 30% of the scores revenue exposure to the most impactful or that highest dependency related activities. So regardless of what you do is say an upstream oil producer, no matter how brilliant your climate policy, no matter how extraordinary your biodiversity risk mitigation, you're still going to have revenue exposure. And that's going to bring down your score at least one or two points. So we would say an upper bound for all of these companies is likely going to be a seven. If you heard everything perfectly and outperform your peers on your actual impact, then seven's the best. We found their Spanish electric utility, Iberdroler was the sole company among the 210 to achieve a score of six or above. And it did so by in our in our judgment, very strong performance across all four of those main issues that we discussed, as well as commitment to and publishing of a task force on natural aid financial disclosures report. So six in this context, extraordinarily high. So to get higher than that really you'd have to be, I don't know, maybe if you were doing this for finance, if we're thinking of talking about big industries, then perhaps it would be possible to get higher. It would, if you had a particular investment strategy, because what you're doing is so flexible in finance in terms of what industries are exposed very much. And the direct, the direct operations of the financial sector will be much less at the the impacts and dependencies. So you have like tangential indirect dependencies versus like the primary economic activities of many of these sectors with much higher impacts and dependencies. Got it. So so whilst it's striking that nobody got better than a six in this report. It's maybe just a reflection of the, I'm not really half glass full about this because six out of 10 is six out of 10. But it's just a real reflection of the challenges that these sectors face. Absolutely. And that's part of the intention behind the scores. We want to capture that these companies, regardless of what they do, still have very high exposure. And a score above five say just means they're doing a good job at managing those very risks for Iberdroller to do better. It would have to implement policies that are not connected or not material to the areas of operations that it's in. They why would Iberdroller have a commitment to reduce pesticides, for example, but that does that does kind of kind of feel does feed into this generalized score. Got it. So it's kind of like for some of these companies to get a higher score, they would have to just become a different company. Yeah, exactly that's one way to start doing something different. Yeah. For example, for BP to excel, it would just have to leave the oil and gas industry, which is obviously not going to happen. So it's it's just the absolute value of the score is not necessarily important. So a company shouldn't be disheartened if it scores 5.5. Rather, it should look at its efforts and feel good that it's well ahead of peers who scored say 2 or 2.5. Was there anyone who came out with zero in all of this? Is it possible to get a score that low? It's it's unlikely because a big component of the scores is relative performance to peers. So if you're significantly more destructive on in terms of emissions, the amount of waste that you generate, the amount of water that you use, and you also have zero policies to mitigate. Yes, you could get a zero. But within these sectors, there's always going to be one company that does much worse in terms of it's relative emissions or relative waste. And that's going to make you look relatively good. I think if we feed all of these attributes into the algorithm, then it will output like a lowest possible score of 1. I'm kind of curious to know. I mean, a simple question I could ask you is, you know, how do the sectors that we looked at compare to each other? But to all of the previous conversations, some of the score is kind of the nature of the particular sector itself. So I know you say like all of these companies are going to be in a good way.
will find it challenging, but I'm guessing it's different for like an oil and gas company versus a utility, you know, in terms of what you can realistically expect them to score. So, I mean, maybe I am going to ask that question, but I would also just like to add maybe a bit of a twist, were there any sectors that stood out for overall doing more with the cards they've been dealt? If you see what I mean, where you're saying, seeing maybe more proactive activities to mitigate the risk may be compared to what you would expect if you're just looking at inherently what they're doing. Yeah, yeah, it does make sense. So, there are still some components that we can score. When we average out the differences in peer comparison, we're still left with the absolute binaries of do you have a commitment to reduce emissions, for example? And so, looking at that, we can see some sectors slightly further ahead and bearing in mind, like exposure to the nature-related impacts and dependencies too, we see that auto makers are slightly ahead on average in terms of score relative to the other sectors. The lowest performing sectors were power utilities and metals and mining, they have extraordinarily high exposure to the risks and tend to do less than the other industries, especially on themes such as water and biodiversity. That being said, the metals and mining industry is a bit ahead in terms of its disclosure, an industry initiative came together and encouraged and worked with the members to do TNFD-related reporting. So, it is doing some good stuff, which is unfortunately, on average, a company is less likely to have a water reuse and recycling program than it might in the water-making sector. I think the thing that's really fascinating to me is that power utilities are in the kind of the framing of this question are doing less than oil and gas companies, because oil and gas is at least in terms of climate exposure, a inherently more polluting industry. And also, if you think about it, just in terms of the sort of the narratives, maybe culturally more resistant to accepting that some of these things are an issue, whereas power utilities are both rooted in fossil fuels, but also have the opportunity to be the driving force behind the reduction of emissions across the economy. So, they have a lot more road to work with, if you see what I mean, and more opportunity to score better. So, why is it that they are doing worse than oil and gas companies, according to this scoring? It's primarily due to investor pressure. Or the largest oil and gas companies are extremely well-known public companies with big brand images. Everyone is heard of the top 50 or 20 oil and gas companies globally. So, they've faced years of pressure on their biodiversity impact, their climate impact, how much water they're using. And as a result, they've marginally improved. They've got policies now covering all of these things and include them in their annual disclosures. That has accounted for an increase in their overall score as a group. Power utilities, however, on average, are less familiar to the average consumer and face less pressure. If you look through the list of the 30 largest power utilities that we've covered, they haven't come under this sustained pressure that the oil and gas majors have, and therefore have done slightly less. Of course, among that, there are still individual utilities that are doing extremely well, such as Iberdroller that we mentioned earlier. But on average, it's as a sector behind. That's interesting. So, you, I mean, a lot of utilities are regulated monopolies. So, they don't face any consumer pressure and they don't accept, they're not exposed to the same financial pressure as all of these oil and gas, gas companies that are out in the world having to compete with each other, both for capital and for customers. Now, it's debatable to the degree to which customers choose one brand of gasoline over another based on the green credentials of a company. But still, it seems like what I'm hearing here is that being exposed to other industries and their priorities forces change, maybe where perhaps power utilities, a lot of them. I mean, the power utilities, they're not all regulated monopolies, of course. But they're maybe a little bit more protected from the pressure to change. Absolutely. If you're a regulated monopoly, what's your incentive to do better? Your pursuit of capital is far less dependent on showing what good you do versus how entrenched you are in the market. Yeah. I mean, the only thing that'll really make you change is the regulator. And, you know, regulators have got different concerns right now than water use. Although the contention of us is that will become a much more material thing in the next 10 to 20 years. So actually, that kind of leads me on to the sort of the next kind of maybe angle I want to tackle this from because we've talked a little bit about how different industries compare, but there were these fundamental risk brackets, climates, water and biodiversity. And the fourth is waste impolution. Waste impolution. So can you just talk to us through a little bit about what your findings really revealed on the risk exposure to those four different types of nature risk? Yeah. So on the exposure side, we found that all of these companies across all of these sectors are extremely dependent on something called energy provisioning ecosystem services. And that essentially means if you're in just say that again, slow, sorry, energy provisioning ecosystem services. Yeah. That's right. So that just means that you're going to try and bring that. I'm just trying to use that in a sentence today, along with remain. It's yet all of these all of these sectors are highly exposed to energy provisioning ecosystem services. That essentially means nature gives energy that companies harness and use the power of their operations. That's very unsurprising, but we also find that water use exposure is very high as well. And for example, in metals and mining, water is essential, essential part of the production process in the upstream mining. It's also key in oil and gas production. These majors use extraordinary volumes of water in the production. And this is true downstream as well. The refining uses a large amount of water for a variety of different processes. These dependencies then translate into how much water other companies actually using. And we can see that typically in each industry, one or two companies are using far more than others. And that again is for a variety of different reasons. The same is also true on emissions. We see one or two companies that are far far ahead on their relative emissions intensity. So in short, all of these industries are very highly exposed to all of these issues, but it's the performance of one or two companies that is significantly behind the others that leads to overall average score changes. So let me just make sure I've understood what you've just said. So across climber, water, biodiversity, and waste, they're all exposed. And that's why you chose those pillars, I guess. But it's, you mentioned that there's some that are doing significantly better and some that are doing significantly worse. And in particular, water seems to be an area of differentiation. Yeah. This relatively fewer fields feed into the overall water score. One of the primary things that we found was a lack of disclosure on water use from many companies. Generally, the larger European companies from all of these seven sectors were quite good at disclosing their water use. This includes both the amount of water that they take out and the amount of water that they consume. So that's the amount of water you take out versus minus the amount that you return and water consumption. However, many east and south Asian economies were much less successful in their disclosure, much less comprehensive. Many firms from China or India had almost no disclosures on anything water related. They would typically have a high level water policy where they mentioned water in their filings, but they don't go beyond this. They don't discuss a water use and protection plan. They don't disclose the amount of emissions to water, essentially water pollution that they have. We also examined percentage of assets in areas of high or very high water stress. And typically, we found the companies with more asset scenario areas of high stress were doing less in terms of the policies and interventions that they have to mitigate risks that result. This is so interesting that we're talking about these four pillars kind of equally because I mean, it be any if being an energy analysis company in particular one who's starting point was thinking about clean energy and the issue of climate change. We've always been very focused on greenhouse gas emissions and the impact of climate. And I think that that is fair to say that that is in most people's perception of the challenges we're facing environmentally. That's the thing that it comes kind of front of mind. And stuff like water biodiversity, waste management, maybe being and I might just be my biases here. Sort of secondary concerns like the real alarmism has been around climate. Like, cop is all about climate. I don't know if there's something equivalent for water. I know that there's a biodiversity cop. But those other forms of nature risks seem to have been rising up the agenda and rising up the consciousness. It's I mean, firstly, do you think that like what I'm saying, my perception is is kind of mirrors what you're observing more generally. And if it is, why is it changing? Yeah, absolutely. That's what I first thought when I joined Binaf and this this this role is created to look more in nature. But it's a parallel to what's going on in climate. Binaf has got a very strong team looking at climate. The risks and opportunities both in the real economy and financial sector. And the same the same risks and opportunities are there just through a nature lens. But as we discussed earlier, it's much more of an emergent risk, both academia and the business world are finally starting to get the heads around what exactly this risk is and how it manifests. And it's because of a lack of understanding on how to manage these risks or even what these risks are that they've been secondary. But I would contend that even at Binaf, we do have sectors looking at these things.
We've got the technology and innovation team looks at emerging technologies to handle waste or look at water And we've got an incredible circular economy team looking at these things. It's perhaps among these four different issues that we've discussed biodiversity that's the most emergent and you did mention like cop and how how both policymakers and the business world is considering at this set of issues But while climate cop is the most famous and there is biodiversity cop There's a third one called the CCD which is the cop for desertification Reflecting our understanding of changing land use and decreasing water and earlier this year They announced the creation of a fourth cop which is the cop the cop for oceans and the first one is which is is slated to begin next year So these these are attracting the attention of all stakeholders across Business policy academia everywhere and as they're emerging their little understood But if you look at how for example the financial sector is treating nature every major finance Institution now will have a nature team that is assessing these risks seeing how material they are and discussing internally What they can do to mitigate as well as partnering with the stewardship teams Another interesting kind of thought here and I'd be interested to hear your sort of reflections on this as we're kind of comparing Climate risk and the the issue of climate to these other Sector's is I'm far from saying that it's easy to think about climate but it can be condensed down into like a single problem There's too many greenhouse gases in the atmosphere. It's causing climate to change and so you can distill it down I mean, I know that it's not just carbon dioxide But like other greenhouse gases we can translate it into carbon dioxide equivalent and so there's a very sort of simple metric on how collectively We're doing we can kind of characterize different forms of mitigation We can kind of compare the cost on a dollars per ton of CO2 emitted I guess what I'm saying is it naturally leads itself to being measured and progress being measured and you know in a lot of cases lack of progress being measured but these other areas I have the sense that there's not a single Way of kind of simplifying the issue and kind of communicating how we're progressing how we're doing Do you think that that holds back those when we're thinking about making the comparisons around nature risk? Yeah, absolutely and this is a very common comparison that we see the difference between climate and nature Climate is much easier for two reasons. It's not only just the single metric of CO2e Which in itself can be quite difficult when you look across the different scopes But more than that it's that CO2e is a universal metric It doesn't matter where you sit if you release a ton of carbon dioxide equivalent into the atmosphere in Japan versus in Madagascar you calculate it in the same way But for nature it's far more localized everything depends on how much of the natural resources currently there or to what extent in this locality you're impacting those ecosystem services That makes it extremely challenging so we need an enormous volume of data to accurately assess And we need a very stringent and complex multi-fested framework for calculating exactly what the risk is what the value at risk is and what should be done about that how to manage it You've got to consider companies direct operations as well as supply chains And often companies might not even know where the primary assets are located So how do we manage risk on say deforestation? These things are changing data is available like Bloomberg itself has got an enormous amount But a lot of other providers that what I when I say providers, I mean research organizations NGOs are doing a lot to map and understand these risks one of our advantages is we've got very good asset level data And we can work with these companies for all for example the natural Hishimuseum and its biodiversity and Packness index to combine these two data sets and understand better where the risk is understanding where the risk is It's just obviously step number one managing that risk is step number two And then once you've decided how to manage implementing that is another step the multi-fested characteristics of nature mean that it's extraordinary complex and as it becomes more understood and more material to companies There will be more options to manage one of one of the objectives of these nature risk management courses Essentially a preliminary exploration to assess how companies are doing as this becomes more nuanced than advanced We'll be able to produce different frameworks Specific to each sector they'll build their accurately ranked companies perhaps a bit more Reflecting what's really going on then in this initial research offering. I mean as these risks Become more and more prevalent this nature-based lens is really very germane And I shouldn't even be joking. This is you know serious stuff, but Joking aside, it's kind of like I mean just bringing me right back to the start of the podcast I mean outlining this kind of increasingly complex picture trying to Simplify so that we can all make sense of it in in maybe the way same way that you know Simplifying all these different greenhouse gases into a co2e Help simplify how we think about the the problem. That is why the work you're doing right now is really important I'm guessing and having a framework like yours. I mean, I know it sounds very You know giving all of these companies a score out of 10 across such a kind of complex and diverse set of considerations It's really important work you're doing so I really appreciate you coming in and Explaining it to us today and yeah looking forward to seeing more of the work you do on this topic because it's been a fascinating conversation Yep, thank you very much. Time. I enjoyed this Today's episode of Switched On was produced by Cam Gray with production assistance from Kamala Shelling Bloomberg NEF is a service provided by Bloomberg Finance LP and its affiliates This recording does not constitute nor should it be construed as investment advice Investment recommendations or a recommendation as to an investment or other strategy Bloomberg NEF should not be considered as information sufficient upon which to base an investment decision Neither Bloomberg Finance LP nor any of its affiliates makes any representation or warranty as to the accuracy or completeness of the information contained in this recording and any liability as a result of this recording is Expressly described
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