www.baringa.com/en/climatechangescenariomodel/ Background:XDI: xdi.systems/ Legal & General Investment Management: www.lgim.com Baringa Partners: www.baringa.com/en/ For more information, see www.baringa.com/climaterisk For more information or to schedule an interview, please contact: climatechange@baringa.com. Baringa Partners is an independent business and technology consulting firm. We work globally with governments, financial services clients and the energy sector, as well as in other sectors, to accelerate decarbonisation, manage risks and adapt to climate change. We work with many of the world`s largest banks, insurers and investors, including advising on many of the largest renewable energy projects that already generate enough electricity for more than 200 million homes. Baringa has designed and developed a framework to model [1] the global energy transition in several scenarios. The most cost-effective optimization model required an initial data set of more than 500,000 data points, drawing on Baringa`s deep decarbonization expertise across multiple markets, to explore and consolidate these inputs. This helped solve the optimization model by 2050. Baringa`s model was used by Legal & General to develop its TCFD report, which will be published today. Destination@Risk enables a robust measure of climate risk embedded in investors` portfolios and their climate orientation. By the first quarter of 2021, a climate risk dashboard will be made available to portfolio managers and analysts within LGIM, enabling LGIM to systematically integrate climate risk and alignment into its global investment function. Destination@Risk was developed over an 18-month period in partnership with Baringa using its climate change scenario model as a critical basis and was initially used to assess climate risk and align L&G`s own balance sheet assets, as described in the 2019 report of the Company`s Task Force on Climate-Related Financial Disclosures (TCFD). To understand the risks and opportunities that this transition presents for LGIM`s portfolio energy companies, they looked for a tool to: By benchmarking with other scenarios, LGIM was able to challenge third-party scenarios and challenge their own underlying assumptions and sensitivities in order to iteratively improve the accuracy of inputs, model methods and results. Founded in 2000, Baringa today employs more than 700 people and more than 70 partners in our five practice areas of energy and resources, financial services, products and services, as well as government and the public sector.

These practices are supported by cross-industry, customer- and digital-focused teams. Finance, Risk and Compliance; people`s excellence; supply chain and supply; data, analytics and AI; Intelligent automation and excellent operation; and technological transformation. We operate worldwide and have offices in the UK, Germany, Australia, USA and the Middle East. « The level of risk and capital employed is considerable. However, the correct assessment of the financial materiality of this climate risk is a major challenge for today`s investors. We believe our framework and modelling capabilities will enable investors to properly assess climate risk in their portfolios and make strategic asset allocation decisions that will have a real impact on the type of energy system being built. David FitzGerald, Director, Climate Risk, Baringa: « The analysis of climate risk in a portfolio of this size reveals completely unexpected strengths and weaknesses. A whole new level of decision support comes into play, from the level of assets to strategic direction. « Most financial institutions are currently unable to demonstrate the climate impact of their investments or the climate-related risks of the assets they hold. They are also unable to prove to their investors that their values match. Regulators are starting to force companies to act – with the Bank of England at the helm. However, we are now seeing a considerable level of commitment across the industry at the senior management level and increasingly decisive actions – across strategy, risk, investment management and ESG functions.

Legal & General Modular Homes selected as preferred developer for Wolverhampton Residential Canalside South Major Project Over the past five years, exceptional efforts on climate change have been made across the financial sector – an effort that is still ongoing as we strive to create a climate-resilient financial system and supporting the scale of capital flows. and that enable the transition to carbon neutrality. How does a big bank prove to regulators that it is serious about climate change? XDI analyzed 1.8 million assets associated with 1,800 publicly traded companies in the United States, Canada, Europe, Africa, the United Kingdom and Australia to detect climate risks such as floods, coastal floods, heat, drought and wildfires. XDI`s data and analytics form the basis for quantifying physical risks in the new framework launched today in London. Legal & General launches a three-year partnership with RedSTART, a charity for children`s financial education The value of an investment and the resulting returns are not guaranteed and can both go down and up, you can`t get back the amount you originally invested. Past performance is not a guarantee of future results. You should consult with an independent investment advisor before making an investment to determine if it is appropriate for your situation. LGIM will also introduce a climate solutions feature for institutional investors, also available from the first quarter of 2021, which will use the modelling tools developed to measure the climate alignment of clients` assets and design and implement solutions for Pathways to Paris. Coordinated action on a global scale is needed to ensure no more than 2 degrees of global warming – LGIM stresses the urgency of political action to encourage the rapid changes needed. Oliver Rix, Head of Climate Change, Energy and Environment at Baringa, added: « Our global model builds on Baringa`s 20 years of experience helping governments and policymakers assess transition pathways, develop strategies to decarbonise companies and assess energy markets and investments with investors. Our partnership with XDI will then bring with them the world`s leading solution for physical risks. Our integrated model enables financial service providers to integrate climate risk measurements, funded emissions and temperature alignment into their core strategic and operational decisions.

LONDON, 12. March 2020 /PRNewswire/ — XDI, an Australian Clim Tech company, today partnered with Globals Legal & General Investment Management (L&G) and Baringa Partners to launch a new market-leading climate change risk framework based on the most comprehensive global climate change data available. Given that how this transition will unfold in the long term depends on a number of complex and interrelated factors (policy, technological progress, consumer demand, etc.), it is crucial to develop scenarios in a coherent and rigorous approach to assess the potential impact on energy companies and therefore on the companies investing in these energy companies and the financial risks in these energy companies. to investigate and evaluate. Cris Lowery, Senior Manager and Project Manager, Baringa « The global energy system is very complicated, and it is not easy to replicate it in a computer model. We developed a framework to model the system, collected and derived about half a million data points, and then ran an optimization engine. This work has made the most of our capabilities in optimization, visualization, financial services and energy markets. Antoine Bezat, Head of Stress Testing Methodologies and Models at BNPP, said: « Climate scenario analysis is a crucial strategic capability for BNPP. We are delighted to be working with Baringa, who are in-depth experts in this field. They bring 20 years of experience in modeling energy systems and climate change, as well as their experience as a leader in implementing climate strategies in several of the world`s largest banks. The ability to refine inputs/scenarios and analyse estimated financial impacts at different levels of granularity (global, regional and even up to the level of individual companies) has created a structured and replicable approach to implementing the risk of transition to climate change across the investment framework and led to sustainable financing decisions. As financial regulators around the world call for climate risk stress tests, companies may soon be required to test the physical and transition risks of climate scenarios as impacts increase due to climate change.

About BNP Paribas BNP Paribas is a leading bank in Europe with an international reach. It is represented in 72 countries with more than 202,000 employees, including more than 154,000 in Europe. The Group holds key positions in its three main activities: domestic markets and international financial services (whose retail banking networks and financial services are covered by Retail Banking & Services) and corporate and institutional banking, which serves two client franchises: corporate and institutional investors. The Group supports all its clients (individuals, associations of municipalities, entrepreneurs, SMEs, companies and institutional clients) to carry out their projects through solutions that include financing, investment, savings and protection insurance.