Climate risk transformation at an Australian bank
Client challenge
An Australian bank needed to incorporate physical climate risk into portfolio management and credit decisioning, in response to new regulatory expectations under AASB S2 and APRA CPG 229. Existing risk frameworks lacked the location intelligence, climate data integration and decision-ready insights required to quantify exposures and identify high-risk assets at scale
Our role
Sustain 2050 was appointed as the bank’s sole climate risk transformation partner, responsible for embedding climate risk intelligence into portfolio analysis, credit processesand frontline decision-making
Approach
We delivered an end-to-end climate risk capability built around geospatial enablement and integrated risk analytics:
Enabled location intelligence by mapping assets and property attributes at a discrete level
Integrated physical climate risk modelling, geospatial data and loan metrics including LVR, arrears and financed emissions
Developed a Climate Risk Dashboard in Microsoft Power BI, providing portfolio- and asset-level insights across scenarios and time horizons
Supported change management, including banker upskilling and process uplift to embed climate considerations into credit decisioning
Outcomes
Regulatory alignment: Climate risk management aligned with APRA expectations and AASB S2 disclosure requirements
Climate-aware credit decisions: Physical climate risk embedded into underwriting and portfolio management processes
Improved customer engagement: Proactive engagement with higher-risk customers to support adaptation and resilience
Decision-ready insights: Quantitative and qualitative climate risk metrics visualised through a single, integrated dashboard
