California requires companies to report carbon emissions
California has just dropped a bombshell on the corporate world with the unveiling of The Climate Corporate Data Accountability Act, or as we like to call it, the “Green Giants’ Reality Check.” This game-changing law is a massive leap towards tackling climate change head-on, and it’s got businesses quaking in their eco-friendly boots. If […]
European Sustainability Reporting Standards
1. What is it? The Corporate Sustainability Reporting Directive (CSRD) went into effect on January 5 2023 to reinforce the reporting requirements for social and environmental reporting and requires companies to make extensive, detailed disclosures about sustainability performance and related strategic implications. The aim of the CSRD is to bring sustainability reporting on par with […]
From Worthy to Invaluable: How Strong Leadership Catapults Financial Services Consultants to Success
Introduction In this opinion piece I’ve set out some core lessons I’ve learnt as a business leader of our financial services consulting firm, Aspect Advisory, and specifically the correlation between strong leadership and the success in the financial services space. As the world of finance becomes increasingly complex, the role of exceptional leaders has become […]
Greening the Financial Landscape: The Surge of ESG Regulations for Institutions
I. Introduction In today’s financial landscape, strong balance sheets and positive earnings forecasts are no longer the only factors that determine the success of financial services organisations. Stakeholders, including investors and customers, are increasingly evaluating firms based on their commitment to addressing broader economic and societal challenges. Environmental, social, and governance (ESG) considerations have become […]
Data-driven vs. Data-information
Data-driven vs. data-informed decision making is a critical topic for business leaders in the digital era. Understanding the distinction between these two approaches empowers organisations to leverage their data effectively and gain a competitive edge. While both methodologies rely on data analysis to drive decision-making, there is a fundamental difference in their underlying principles. The […]
Model Validation
Financial institutions, such as Banks, use various models to make important decisions, such as credit risk assessment, capital allocation, and pricing of financial products. These models are designed to analyse large amounts of data, identify patterns, and provide insights that can help banks make informed decisions. However, as with any analytical tool, these models are […]
UNDERSTANDING EXPOSURE AT DEFAULT
Forecasting what exposure to a client might be at the moment they default In the dynamic world of banking, understanding and managing risk is the linchpin of sustainable success. A shining beacon in this endeavor is the concept of Exposure at Default (EAD), an integral element of robust credit risk management. This article delves into […]
Stress Testing Against Climate Risk – A key Emerging Exercise for Banks
Climate Risk Stress Testing Background Climate change is one of the most complex challenges that society faces today. The continued and growing emissions of greenhouse gases since the industrial revolution have led to increased GDP, but at the price of increasing temperatures creating risks to life, ecosystems, and economies. There is increasing consensus that risks […]
ON THE STATE OF CRYPTO ASSET REGULATION IN THE EU
Crypto Asset Regulation The Basel Committee’s public consultation on the prudential treatment of banks’ crypto asset exposures builds on the proposals in the first consultation issued in June 2021. Unbacked crypto assets and stable coins with ineffective stabilization mechanisms continue to be subject to a conservative prudential treatment, with a new limit proposed on gross […]
CRR 3 – Changes and Impact on Exposure Class “Real-Estate”
More granularity for a complex market The Economist recently reported that Real Estate is the largest asset class in the world, making up 68% of the world’s non-financial assets in 2020.[1] It naturally follows then that a large portion of European banks’ lending is dedicated to real estate. This is the latest asset class to […]