ESG lab

Who We Are

Our team is dedicated to tackling the toughest ESG challenges in the financial industry. We develop technical, data driven, and operational solutions to help upscale your sustainability efforts.

We are a team of ESG analysts working in tandem with the Data lab comprising a range of different technical backgrounds (corporate and market finance, climate change, social impact assessment, and more) dedicated to accelerating the allocation of financial assets to sustainable solutions. Our team aims at guiding financial decision makers towards low-carbon and positive impact solutions.

Portfolio climate alignment

Develop tailor made methodologies to estimate alignment of financial portfolios with climate scenarios. We co-develop strategies to drive emission reduction of investments (GFANZ commitments).

Regulation compliance

Creating and supporting the implementation of ESG risk management techniques in compliance with sustainable finance regulation (SFDR, Taxonomy…).

Financial engineering for green solutions

Support organizations searching to finance their low-carbon solutions. We integrate financial expertise and environmental sciences.

ESG factors and financial performance

Study of correlation and causality between extra-financial (ESG) criteria and financial performance of assets.

Case studies

Auto loan portfolio footprint and Net Zero alignment

Created a state-of-the-art methodology to estimate carbon emissions of an auto loan portfolio. Modeled the portfolio’s current Net Zero scenario alignment and the effects of carbon reduction actions to reduce future emissions.

Why? To create the tools that identify the main sources of the portfolios emissions and pilot its Net Zero strategy to comply with the corresponding NZBA commitments.

Developed a predictive model to estimate vehicles’ carbon emissions through vehicle criteria (motorization, age, weight…) and driver data (income, age…).
Applied these emissions metrics to estimate the portfolio’s level of alignment with a Net Zero climate scenario.
Modeled the expected effects of the bank’s action to reduce emissions of the financed vehicles.
All analyzes were developed at country specific level.

Climate scenarios, climate alignment, automotive sector, personnal loans structure

Auto insurance portfolio Net Zero Alignment

Co-constructed a methodology to estimate insurance portfolio’s Net Zero alignment. Estimated required effort to reduce emissions and align with the scenario to establish Net Zero targets within the framework of the Net Zero Insurance Alliance (NZIA).

Why? To create the tools that identify the main sources of the portfolios emissions and pilot its Net Zero strategy and establish its commitments.

Estimated the insurance portfolio’s (auto) carbon emissions and its alignment to a Net Zero scenario.
Modeled the expected effects of the insurer’s action to reduce emissions of the insured vehicles to asses level of efforts for achieving emissions reduction.
Supports the insurer in establishing its carbon emission reduction targets within the context of the NZIA.

Climate scenarios, climate alignment, automotive sector, insurance risks

Financial engineering for geoenergy

Developed a financial engineering model to estimate the investment risk return profile of geoenergy (shallow geothermal) projects for heating and cooling buildings.

Why? To facilitate the financing of shallow geothermal installations: a low carbon heating and cooling solution frequently not adopted because it is CAPEX intensive.

Studied the different existing possibilities to finance CAPEX intensive long-term low emission energy projects.
Developed financial engineering model to estimate projects’ risk-return profile: applying project specific thermal engineering criteria (coefficient of performance, estimated energy consumption…) and financial criteria (share of debt and equity, interest rate…) generate expected return and risk metrics under different scenarios.
Analyzed how environmental gains (emission reduction, through an LCA approach) may benefit financing (regulation compliance and carbon credits).

Financial Engineering, Corporate Finance, Green Finance Regulation, SPV structure

Our Address

28 Pl. de la Bourse, 75002 Paris

Email us

contact.esglab@institutlouisbachelier.org

A hub for state-of-the-art sustainable finance R&D projects

Get in touch with us to understand how we can help you