All posts by Gabriel Gross

Meteo Protect and BNP Paribas launch innovative solutions for weather risk management

BNP Paribas Meteo protect

Meteo Protect, the European leader in weather risk management, has entered into a strategic partnership with BNP Paribas to offer BNP Paribas’s corporate and institutional clients a complete range of weather risk financial management solutions.

Meteo Protect and BNP Paribas today launched a unique and comprehensive range of financial risk management solutions for BNP Paribas corporate and institutional clients. As a result of this alliance, BNP Paribas is the first bank in France to allow its clients to put in place effective financial solutions to manage their exposure to the increasing risk of adverse weather conditions.

BNP Paribas customers may now also access consulting services to assess and manage their weather risks. Meteo Protect’s team of meteorologists, climatologists, quantitative analysts and actuaries will provide BNP Paribas’s customers the means to manage volume, yield and price risks.

“Thanks to this alliance, clients of BNP Paribas whose activity is affected by the weather at any point along the supply chain may now cover against increased costs, offset declines in turnover, or limit the volatility of their financial results from one year to the next,” says Dr. Jean-Louis Bertrand, Director of Research and Development of Meteo Protect.

“This exclusive partnership allows our customers to analyze and better understand their exposure to changing weather. This approach is fully in line with our purpose to serve our clients better by offering innovative services to support the growth of their business in a sustainable manner, “says Mr. Frédéric Rochoux, Head of Business Development Business in Retail Banking in France of BNP Paribas.

Measuring and Managing Weather Variability: Protecting Businesses from WeatherRisks

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Download the White Paper

A new white paper has been released today by the researchers of Meteo Protect exploring the impact of changes in weather to find the maximum potential loss caused by adverse weather for any business. This innovative approach allows risk managers to have a full understanding about the impact of daily deviations from expected or seasonal weather and to be able to evaluate, for the first time, the total extent of their exposure to the weather.  In turn, they may determine how much of this risk should be hedged in order to secure their sales and EBITDA, and to assess the changes they need to make to their operations and business practices to mitigate risks attributed to climate change.

Given the heightened attention to the effects of climate change on all sectors of society at the recent Cop21 climate conference in Paris at the end of the year, businesses are facing increased scrutiny of their contribution to climate change by governments needing to meet emissions targets. At the same time, the effects of climate change are already impacting business profits, and investors and shareholders alike are also applying pressure, demanding climate vulnerability assessments to study the weather risks to which the business in which they have invested is exposed, and how the company is mitigating these risks.

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Ranking UK retail sectors

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A new white paper has been released today by Meteo Protect demonstrating the importance of unseasonal weather on the sales performance of UK retailers, and the growing need to actively manage its financial consequences. The extent to which retail companies are exposed to climate variability is likely to be an eye-opener for many banks, regulators, analysts and investors. As climate variability is increasing, the risk to which they are exposed requires urgent action.

The research report thoroughly investigates the relationship between monthly sales and climate variability. For the first time, for each season, retail sectors are ranked according to their sensitivity to temperature, precipitation, humidity rate and wind speed.
The authors provide retail managers with a methodology to calculate the contribution of weather to sales performance and to evaluate sales at risk caused by climate variability. They also provide analysts with rankings that classify retail sectors according to their sensitivity to climate variability.

To mitigate the exposure to climate risks, the idea that geographical diversification is a natural efficient hedge is wrong, and the scientific evidence exposed in this report is unequivocal. Climate variability is a risk that needs to be managed like any other financial risk. One way to become more resilient to climate risks is to use weather-index products that are designed to pay in case of unfavorable weather. If companies are resilient to climate variability on an on-going basis, they will, by definition, become resilient to climate change.

The contribution of this research paper is of course not limited to the UK as the methodology is reproducible to other countries and sectors. A must-read for finance executives and business managers ahead of COP21.

Download the White Paper