IMPACT Awards 2023

Award for impact measurement and metrics (biodiversity): Iceberg Data Lab

The localised and complex nature of biodiversity means measurement is one of the most difficult areas for financial institutions to grapple with.

In order to "mitigate the complex challenge of measuring impact on biodiversity loss", Iceberg Data Lab created the Corporate Biodiversity Footprint tool. Using reported data and other publicly available information, an annual assessment of the biodiversity impact of corporates, sovereign issuers and financial institutions is created.

The assessment focuses on the most material environmental pressures on biodiversity: land use, climate change caused by greenhouse gas emissions, air pollution which leads to ecosystem disturbance, as well as water pollution.

The footprinting tool, which is designed to help with investment strategies, has already been used across several indices and funds, many of which have been launched in the last year and a half, including the HSBC World ESG Biodiversity, BNP Paribas Easy ESG Eurozone Biodiversity Leaders and the Solactive Transatlantic Biodiversity Screened Index.

The tool has also been created to align with several reporting frameworks including France's Article 29 legislation and the  Taskforce on Nature-related Financial Disclosures (TNFD). It has so far been used for reporting purposes by BNP Paribas Asset Management, AXA Investment Management and Banque de France.

In 2021, the latter became the first central bank to commit to mitigating its biodiversity impact and subsequently committed to further integrating nature into its investment strategy in August this year. The footprinting tool was used to measure the impact of its equity capital portfolio and pension commitments on biodiversity loss. Wonderpus, another of Iceberg Data Lab's tools, was also used to help mitigate its biodiversity impact. This creates an impact score for over 1,200 sectors and 2,300 products and services and can be tailored to each financial institution's portfolio.

Iceberg says it has several other tools to give financial institutions a "holistic" suite of tools to measure and manage impacts within their portfolio, including a climate footprinting tool, a Positive Impact measurement tool, and another to measure net environmental contribution.