CGFI Annual Forum 2024 Innovation Showcase | CGFI

Annual forum 2024 research showcase

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Science for greening finance

15:30, 4th June | Godfrey Mitchell Theatre, One Great George Street

The Natural Environment Research Council is funding research to enhance the resilience of the financial system to the increasing impact of climate and environmental variability and change and drive more sustainable investment of capital, and to develop solutions needed to embed the values of biodiversity in financial decision making.

The CGFI Annual Forum Research Showcase will feature leading researchers tackling these challenge, including research supported by NERC’s Climate and Environmental Risk Analytics for Resilient Finance (CERAF) and Integrating Finance and Biodiversity for a Nature Positive Future (Infinbio) programmes.

Learn more about these leading-edge research projects below.

Financing Green Sector Transitions: AgriFood

This Flagship addresses the need to restore nature in the UK's agriculture sector, which accounts for over 70% of landcover. In collaboration with major players - the agri-food sector, investors, and civil society - it will develop financial tools and policies. These will be implemented at real-world sites in England and Northern Ireland to assess their impact on biodiversity. The research will also analyse the impact on habitats of international supply chains, such as tea and rubber imports. The goal is to create financial instruments and reporting mechanisms that benefit investors, land-users, nature, and society, while addressing the impacts of global agri-food chains on biodiversity.

Wind and Flood Damage and European Property Risk

The project team researches flood and wind risks to property in the UK and mainland Europe. Outputs have included a new Flood Severity Index (FSI), which can be used to help insurers understand compounding risks, and a demonstrator tool which shows multiple correlations between wind and flood hazards in Europe across multiple timescales. The team work directly with financial institutions and industry stakeholders, including participation in workshops and collaboration with insurers/reinsurers, mortgage providers and risk/catastrophe modellers.

CGFI Wind/Flood tool

Greening Finance for Nature

This Flagship takes aim at the decision-making processes of financial institutions such as banks and asset management companies. Their decisions can impact nature adversely, and this needs to change. The focus will be on portfolio risk management, business strategy, risk disclosure, and the prevention of greenwashing. The challenges include securing reliable data, addressing gaps in scientific knowledge, and bridging the gap between science and finance. The goal is to revolutionise financial decision-making by incorporating nature within it. This will be driven by scientific data and guidance, and new regulatory frameworks.

Infrastructure risk and the Resilient Planet Data Hub

CGFI’s work on infrastructure risk contributed to (as a founding partner) the Global Resilience Index Initiative, a project to address the data emergency that is contributing to the climate crisis by helping sectors across the global economy quantify the value of building climate resilience and the costs of doing nothing. The GRII is now operating as the Resilient Planet Data Hub, convened by the the UN Office for Disaster Risk Reduction, the Insurance Development Forum, and the University of Oxford as a cross-sector group with a common view on the critical need to guide resilience policy and capital decision-making.

Resilient Planet Data Hub

Financing Biodiversity

This Flagship tackles the challenge of financing biodiversity conservation with integrity at a large scale. It will promote best practices and coordination in biodiversity finance, and will champion the importance of between-site biodiversity. This will ensure that conservation is effective, interconnected, and extends beyond individual sites. Key stakeholders, including the Biodiversity Credit Alliance, will help to deliver a theory of change for the scaling-up of biodiversity finance. The goal is to define what high-integrity finance for biodiversity should look like, and to identify the barriers and opportunities that exist.