36 Questions
What is the purpose of examining emissions trajectories in transition risk assessment?
To align facilities, strategies, and portfolios with global climate goals
What is a limitation of using emissions trajectories in physical risk analysis?
They do not account for the lag in the global climate system
What is a common parameter that must be decided on when conducting climate scenario analysis?
The scope of the analysis
What is an example of a quantitative output from climate scenario analysis?
A revenue forecast
What is a factor that can influence the scope of climate scenario analysis?
The availability of data on supply chains
What is an example of a built-in parameter or assumption in climate scenario analysis?
The GDP growth rate
What is the primary purpose of using global reference scenarios in transition risk analysis?
To create sector-specific scenarios for emissions trajectories
Why are global scenarios less important for physical risk planning?
Because the significant physical differences between emissions scenarios only manifest after 2050
What is the purpose of representative concentration pathways (RCPs) and shared socioeconomic pathways (SSPs)?
To broaden the use of scenario-based modeling beyond scientific use cases
What is the main benefit of using scenario planning for corporate contingency planning?
To integrate climate risk into investment and strategic decisions
What is the primary audience for global-level scenarios and scenario-based modeling?
Corporations and financial institutions
What is the timeframe for when physical differences between emissions scenarios start to manifest?
After 2050
What is the primary difference between the old RCPs and the new SSPs in terms of their start years?
The old RCPs started in 2007, while the new SSPs started in 2014
What is the primary purpose of the 2°C-compliant SSP1-RCP2.6 scenarios?
To reflect higher emissions in the 2007-2014 period
What is the name of the scenario that combines climate and social targets and limits warming to 2°C in line with Paris targets?
Sustainable Development Scenario
Which organization has modeled net-zero emissions by 2050 scenarios?
IEA
What is the main difference between the SSP scenarios and the RCP scenarios in terms of their emissions trajectories?
The SSP scenarios have different emissions trajectories, while the RCP scenarios have identical emissions trajectories
What is the name of the scenario that reflects existing policy frameworks and announced policy intentions?
Stated Policies Scenario
What is the primary objective of integrating climate scenario analysis into asset management, as demonstrated by Abrdn and LGIM?
To develop a climate-resilient investment portfolio
What is the purpose of Destination@Risk, the bespoke climate risk framework developed by LGIM and Baringa Partners?
To integrate climate scenario analysis into asset management
What is the primary benefit of using climate scenario analysis in transition risk assessment, as demonstrated by the consolidated transition risk heat map?
To identify high-transition risk sectors
What is the primary goal of Abrdn's climate scenario framework integration into its investment activities?
To integrate climate scenario analysis into business strategy
What is the primary benefit of using scenario planning for corporate contingency planning in the context of climate change?
To enable climate-resilient business strategy
What is the primary focus of the consolidated transition risk heat map across six high-transition risk sectors?
To identify high-transition risk sectors and their potential financial impacts
Which entity provides detailed data on different asset classes by scenario and time horizon for firms to conduct in-house analysis?
Oliver Wyman, Ortec Finance, and NGOs
What is the primary use of the PACTA methodology in climate scenario analysis?
To assess the alignment of investment portfolios with climate goals
What is the main benefit of using scenario planning in climate risk management?
It provides a framework for identifying and mitigating climate-related risks
Which of the following is a key characteristic of the 'Sky 1.5' scenario developed by Shell?
It is a 2°C-compatible scenario
What is the primary purpose of the PACTA for Banks methodology?
To assess the alignment of corporate loans with climate goals
Which entity has developed a methodology for assessing the alignment of investment portfolios with climate goals?
2 Degrees Investing Initiative
What is the primary function of Integrated Assessment Models (IAMs)?
To allow analysis of how societal and economic choices affect each other and the natural world
What is a key consideration in climate scenario analysis related to the time scale of the analysis?
The relevance of long-term infrastructure planning
What is a key challenge in integrating climate scenario analysis into sustainable investment strategies?
The difficulty of incorporating qualitative analysis into investment decisions
What is a key output of climate scenario analysis in the context of climate risk management?
Asset valuations reflecting the impact of climate change
What is a key parameter that must be decided on when conducting climate scenario analysis for a company?
The timeframe for the analysis (e.g., 2030, 2050, 2100)
What is a key benefit of using Integrated Assessment Models (IAMs) in climate scenario analysis?
The ability to integrate societal and economic choices with natural systems
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