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Global Investment Manager Sees Future Opportunities Through ClimateLens

March 30th, 2023

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Challenge 1:

One of the largest investment managers in the world needed to assess climate and water risk across its global land-focused portfolio. The company has mostly permanent crops in its portfolio, such as pistachios, almonds, and wine grapes. These crops have lengthy cycles that require long-term planning — for example, a pistachio tree just planted will take five years until it starts to yield nuts, with a total life cycle of about 30 years.

With about $9.7 billion of assets under management and 3 million acres across 600 properties in 10 countries, the team needed a reliable platform that could provide both a deep dive into properties and threats to crops with granular insights as well as one that could conduct a portfolio-wide analysis.

Challenge 2:

ClimateAi helped the company evaluate how climate change will shape both risks and emerging opportunities across over 2 million acres of land holdings globally and beyond, to new potential investments.

ClimateAi’s ClimateLens-Adapt tool vetted the company’s portfolio to determine if the climate conditions in their locations will continue to be suitable for the crops growing in them over the next few decades. The tool has provided the company with data to inform its decisions on capital expenditures — critical in its strategic planning.

Additionally, the company used ClimateLens to assess potential investment opportunities and make decisions on future investments. It can also identify emerging regions for crop production to optimize its investment strategy. The platform is a key part of its risk assessment and due diligence processes. It removes the risk in long-term investments.

Results:

  • The company saw a $6.3M increase in trading profits by adjusting its contract strategy with ClimateAi’s insights.
  • Overall, the company calculated a 17x ROI from ClimateAi’s technology, as it was able to more quickly and cost-effectively conduct due diligence and identify new regions for growth opportunities in renewables and agriculture lending.
  • The company’s engagement with ClimateAi was featured in the Wall Street Journal, generating new marketing opportunities.
  • It also could understand portfolio-wide climate risk to build confidence in long-term investment strategy by identifying “tipping points” with tangible information about risks and the timing around them.
  • Overall, ClimateAi reduced the costs of trials, lowered production losses (by finding more suitable locations more quickly), and enabled higher margins by finding locations that are more efficient for productions.