Risk Data & Services – a suite of three innovative solutions – supports companies in anticipating some of the big risks they face. Corporates get an in-depth understanding of how climate change, supply chain disruptions or other shocks could impact their business. As part of this suite of solutions, Sustainability Compass focuses on gauging physical climate risks, such as flood, extreme wind and drought.

"Our goal is to empower clients to manage their own risks. Sustainability Compass gives clients an overview of climate-related risk to a company's facilities and operations. The understanding of potential future developments helps them to put mitigation measures in place, such as shifting production activities away from exposed areas," explains Bernhard Rannegger, Sustainability Solutions Expert.

The solution came from the team's deep engagement with corporate clients. They realised that while companies needed to understand the risk of severe weather to their business, they did not have the means to adequately inform themselves.

Building on Risk Data & Services' philosophy of helping clients to get ahead of risk, Bernhard and team have addressed this issue. Their tool can simulate various future hazard risk scenarios related to climate change, such as heavy storms, sea level rise and wildfires across locations. Sustainability Compass comprises climate risk data and analytics capabilities powered by Swiss Re's Climate Risk Score data and its natural catastrophe models.

"By uploading their asset portfolio and data onto the Risk Data & Services platform, clients can create a single source of information across teams. The insights can be used for portfolio-level reporting on existing assets as well as to inform themselves of future developments. Ultimately, Sustainability Compass helps companies to put their climate risk management strategy into action," says Anja Zimmermann, Solution Design & Delivery Lead.

Stress testing assets with a digital twin

Sustainability Compass helps clients build a digital twin of their business to get an accurate overview of their risk exposure. With this precise virtual representation of their assets, they then analyse and stress-test their business activities in the near and long term based on three different climate change scenarios of low, medium and high global temperature increases. This provides actionable insights into the risks and impacts of events such as tropical cyclones or floods, which in turn helps corporates formulate mitigation plans. For example, they can factor in the likely impact of physical climate risks on their supply chain as part of their vendor selection process.

"When you're building a new offshore wind park, or setting up a new production site, you don't want to wait for a big hurricane or flood to find out how your investment is exposed. With Sustainability Compass, we can visualise the hot spots and development of key perils through a digital twin that helps predict the risks of severe weather," says Anja.

Sustainability Compass is also a useful aid to strengthen climate-related risk reporting for regulatory compliance frameworks. This is significant given increasingly complex reporting metrics. It also helps sustainability managers to understand and report on their company's dependencies and impact on its natural surroundings at any location – such as water scarcity or land erosion – by tapping into Swiss Re's Biodiversity and Ecosystem Services Index. For example, companies can make sure that they can operate in areas with enough water availability.

"With this solution, we support clients in staying one step ahead of threats. This means they can quickly bounce back following setbacks and adapt their business based on new emerging risks and opportunities. Ultimately, they strengthen their business resilience to improve future outcomes," concludes Bernhard.

Other solutions available through Risk Data & Services

Risk Data & Services' Property Exposure Management solution not only gives risk managers insights into their property portfolio exposure but also assists them in quantifying potential losses. A multinational utility company, for example, uses the tool to identify which power generation assets are most exposed to natural hazards such as floods or storms. They can then focus on mitigating risk and preventing losses.

Risk Data & Services' Supply Chain Resilience solution helps clients to uncover hidden vulnerabilities across their supply chain network. They can simulate potential disruptions and prepare accordingly. Should a certain area be impacted by natural catastrophes or geopolitical issues, they will already have created a business continuity plan they can implement.