Climate risk stress testing and scenario analysis

RiskSphere employs a combination of stress testing and scenario analysis to investigate identified sustainability risks and opportunities. This dual methodology ensures a robust and comprehensive approach across various time horizons.

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How we help

Climate risk stress testing and scenario analyses help companies grasp their exposure to sustainability-related risks in their portfolio across various time horizons. Our service includes:

  • Managing your data to create order and overview
  • Ensuring compliance with all regulatory requirements, on time and on quality 
  • Providing assurance of a future-proof business model, strategy, and operations

Climate stress testing

Stress testing is a proven method of investigating the short-term risks to an organisation. Stress tests are part of many regulatory cycles but can also add value when initiated and executed solely for internal use 

ESG risk drivers are increasingly part of the narratives used in stress testing. Our expertise includes building these narratives as well as quantifying them: from risk drivers, through parameters up to the shocks in financial ratios relevant to the organisation’s risk taxonomy. 

Your benefits:

  • A comprehensive and robust methodology, facilitating timely regulatory compliance 
  • Enhanced dialogue with internal and external stakeholders 
  • Insights into the short-term risks and opportunities 
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Document with statistics | RiskSphere

Scenario analysis

Scenario analysis is a tool to explore various plausible futures in a structured way. The goal is not to predict the future, but to better position the organisation to make strategic decisions that will be sound for all plausible futures.  

Both regulators and CRO’s see scenario analysis as a valuable addition to the strategic review and risk management cycle, given that climate and environmental risks and other ESG factors often have long-term horizons and uncertain impacts.

What we’ll deliver:

  • A structured examination of the interplay between ESG risks, opportunities, and company strategy 
  • Improved internal and external communication 
  • Increased organisational resilience through insights into possible futures and courses of action

Let us do the heavy lifting

Establishing stress tests or scenario analysis can be challenging. We’re here to help! Contact us for assistance.

Get in touch
Henk-Jelle Reitsma | RiskSphere

Henk-Jelle Reitsma