Our Industry Environmental Risk Rating methodology defines an environmental risk rating for over 43 global industries. The tool evaluates environmental risk at the sector level, providing valuable insights to our business teams on the environmental risks facing each industry, along with various transition strategies being adopted by each sector.
The approach awards each sector an environmental risk rating of Low, Moderate, High or Very High based on their overall environmental score between one and four - one being positive and four being negative. It uses a combination of our own quantitative and qualitative analysis in combination with third-party ratings from leading global data providers and NGOs. All sectors are rated across six criteria covering climate, water, waste, toxic emissions, ecological impacts and transition risks, with a double weighting given to climate risk given its interconnection with others and the ability to exacerbate all other risks. The method has been benchmarked against leading industry peers to ensure integrity of approach.
Click to view video of Thomas Patience, Deputy Head of Sustainability, discussing the Bank’s ESG Risk framework.