Verisk Maplecroft launches investor solution mapping global risk exposure of public companies across 4M+ corporate assets
Risk intelligence company Verisk Maplecroft (Nasdaq: VRSK) has today launched a new data solution assessing location-specific risks to the assets of over 50,000 publicly traded companies. It provides investors with one of the most comprehensive views available of corporate exposure to global climate, environmental, human rights and political risks.
Combining the locations of 4 million+ corporate assets with industry-leading geospatial risk data, Verisk Maplecroft’s Asset Risk Exposure Analytics (AREA) feature 85 individual risk issues that are mapped down to subnational levels. The solution has been developed to help reveal hidden vulnerabilities and strengths in the global operations of publicly listed firms worldwide and provides investors with a new perspective on companies’ risk and sustainability profiles.
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“AREA helps address investor blind spots by delivering a bird’s eye view of a company’s assets, mapping these to the systematic risks that shape both its financial performance and its effects on the world around it,” says Verisk Maplecroft’s Head of Markets, James Lockhart Smith. “Manufacturing hubs in areas of rising civil unrest, data centres exposed to intensifying climate hazards, mines located in human rights hotspots – the data provides a granular, real-world counterpoint to headquarter-level assessments of risk and sustainability.”
The launch of AREA builds on Verisk Maplecroft’s 20-year standing as a premium provider of geospatial country risk and sustainability data. It also marks its ambition to further enhance its risk solutions for the financial community following the release of its Sovereign ESG offering in 2022, which won recognition at the ESG Investing Awards in the same year.
What sets AREA apart is the breadth, depth, quality and transparency of the data, which features:
- 18 political risks, such as civil unrest, conflict intensity, corruption and democratic governance
- 30 human rights issues across all civil, political and labour rights and human security risks
- 18 climate hazards and issues, which encompass different time horizons and emissions pathways
- 19 environmental risks, including natural hazards, pollution, biodiversity and deforestation
One key advantage of Verisk Maplecroft’s approach is investors can assess companies of all sizes, industries, and geographies against a substantial range of risks in one place using a consistent scoring framework. The 85 risk issues have been selected as among the most critical to investors, but we anticipate adding more of Verisk Maplecroft’s portfolio of 190+ risk indices into the solution over time. To help provide an extra layer of granularity, 50 of the risk issues covered in AREA also draw on Verisk Maplecroft’s Industry Risk Dataset to provide a weighted, sector-by-sector view of risk. All the data in AREA will be available through an API.
The solution is applicable to all equity investing, including sustainable and impact finance. Using AREA, portfolio managers and analysts can assess systematic political risks more easily and rigorously across their portfolios, so they can better optimise investment decisions and strategies. Responsible investment practitioners, on the other hand, can use AREA to better understand company exposure to key issues, including climate, nature and human rights at the asset level, which are rarely captured in traditional company-level sustainability data. AREA can therefore facilitate better risk analysis and portfolio construction, as well as much more targeted and impactful stewardship and engagement.
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“If there’s one thing climate change has taught investors about risk it’s that location counts,” adds Principal Markets Analyst, Franca Wolf, who led on the development of AREA for Verisk Maplecroft. “In a time of heightened global uncertainty, AREA’s ‘big picture’ risk intelligence offers investors enhanced visibility of the world’s most pressing current and future threats and how they may interconnect with their portfolios.”
