Global professional services firm Aon has announced the launch of a dedicated unit to drive climate analytics and advisory into multiple sectors.
As climate change drives new extreme weather records, Aon’s Climate Risk Advisory team – lead by Liz Henderson – has been created to help their clients better quantify the impact of climate risk.
Last year alone, more than 400 natural catastrophes caused $313bn of damage worldwide.
The new team aims to provide physical risk diagnostics and advisory services to help financial institutions, public sector entities and firms with large real estate holdings to make better decisions about their climate-related financial risks.
Climate Risk Advisory will help Aon’s clients by providing forward-looking diagnostics for a range of climate scenarios, applying climate hazard data to individual asset locations to understand key geographies at risk today and in the future.
Additionally, it will also provide climate advisory to build a holistic, end-to-end approach to risk modelling and management, from scoping the exposure to communicating and acting upon strategies.
The team combines catastrophe and climate change models from Aon’s Impact Forecasting and third-party vendors, with analytical expertise from across Aon’s capital, climate, and credit specialties.
Drawing on a wide range of sources, Aon noted, will give clients a highly informed and customised view of risk.
Climate Risk Advisory also draws upon Aon’s 14 global academic collaborations, whose emerging climate research provides an independent view of risk and informs the development of the firm’s catastrophe models.
Henderson, who prior to her new role was co-head of Reinsurance Solutions’ U.S. Catastrophe Management team, commented: “I am excited to be leading a team whose insight has become increasingly important to insurers and reinsurers, and can now be effectively applied to a wider set of Aon clients.
“Our initial focus will be on financial institutions and public sector entities, which have an immediate need to understand their climate risks. Our team takes modelling data and brings it to life with approximately 30 years of experience collaborating with insurer C-suite leaders who manage these issues every day.
“Our advice goes beyond analysing the results of any individual approach, to helping organisations develop holistic climate risk programs that can navigate the inherent uncertainty in climate change to make better decisions on risk management.”
Henderson will report to Joe Monaghan, global growth leader of Reinsurance Solutions, who said: “In launching Climate Risk Advisory, Aon recognizes how financial institutions may benefit greatly from the catastrophe and climate expertise, modelling and solutions we have developed and honed over several decades for the re/insurance sectors.
“Financial institutions can now tap our ongoing investment in our Impact Forecasting models and evolving scientific research, which will help them to navigate volatility and build business resilience.”
In addition to financial institutions and governments, Aon is also bringing these capabilities to companies in real estate, agriculture, and health solutions, according to the announcement.
Climate Risk Advisory, the company added, will provide physical risk solutions that are complemented by Aon’s broader capabilities around Environmental, Social and Governance (ESG) and the transition to net zero.
