Citi selects S&P Global and Oliver Wyman's Climate Credit Analytics for climate stress-testing and ESG reporting

Published on: 09 February 2022
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S&P Global Market Intelligence and Oliver Wyman's Climate Risk Analytics Models cover 1.6 million companies. Citi has chosen the Climate Credit Analytics (CCA) Transition Risk model from S&P Global and Oliver Wyman for 2022. 

Citi chose CCA in 2021 after a protracted trial and collaboration because it supports crucial needs for the company's risk teams and Institutional Clients Group business lines like Corporate Banking, Research, and Markets. Supporting regulatory stress testing of Citi's corporate lending business, which is being driven by regulators including the European Central Bank (ECB) and the Monetary Authority of Singapore, will be a key focus of the agreement (MAS).

"Tackling climate change will require enormous collaboration on the part of Citi and will be one of the biggest challenges of our time. To measure and manage Citi's climate risk and to satisfy the rising demands for climate risk management from international banking regulators, our Climate Risk team needs robust climate data and analytics. The suite of climate data and technology-driven insights produced by Citi's partnership with Oliver Wyman and S&P will offer priceless tools for better understanding and simulating the transition paths of Citi's corporate clients."

said Kunal Motiani, Citi's global lead for the program on climate risk.

"Our work with the teams at Oliver Wyman and S&P Global Market Intelligence aligns to our needs to build a robust infrastructure to support our Risk and Institutional needs as part of Citi's effort to build out a firmwide climate data utility function.

"According to Richard Webley, Head of Citi Global Data Insights,

"Quality climate data is one of our core requirements and S&P Global and Oliver Wyman demonstrated they can help us be on the forefront of understanding and incorporating accurate corporate disclosures."

Climate Credit Analytics, which was introduced in 2021, is a collection of models that aids financial institutions and businesses in determining how the move to a low-carbon economy will affect the creditworthiness of their counterparties and investments. CCA was created as a result of a partnership between Oliver Wyman and S&P Global Market Intelligence.

It offers clients the option to input confidential information to enhance the coverage of more than 1.6 million public and private companies across all non-financial sectors of the global economy. Airlines, auto manufacturing, metals and mining, oil and gas, and power generation are examples of carbon intensive sector specific models that allow for granular analysis that offers distinctive insights based on company-specific attributes.

Whit McGraw, Global Head of Credit & Risk Solutions at S&P Global Market Intelligence, said,

"Citi is an inspiring leader in their commitment to addressing climate change, as demonstrated in their most recent TCFD Report and initial net zero plan. We look forward to working with them and Oliver Wyman to help Citi address climate-related risk implications and achieve their net zero goals."

Ilya Khaykin, Partner and Head of Climate Risk for the Americas at Oliver Wyman, said,

"We're thrilled to deepen our work with Citi on this important topic; climate change is the defining issue of our time and, together with S&P Global, we are committed to helping Citi and the industry manage its implications."

The models build on the extensive environmental, social, and governance (ESG) and risk management expertise of Oliver Wyman and S&P Global Market Intelligence. Oliver Wyman's industry-leading climate scenario and stress testing expertise is combined with S&P Global Market Intelligence's sophisticated Credit Analytics risk models, special industry-specific datasets, and CCA's ability to translate climate scenarios into scenario-adjusted financials and scores at the company level. By natively incorporating the 2021 scenarios released by the Network for Greening the Financial System and assessing the impact of customized scenarios, Climate Credit Analytics enables climate scenario analysis through 2050.

Source: Citi group news

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