NEREUS and Eurisy organize a series of webinars focused on ten sectors identified in the proposed EU Directive on the resilience of critical entities. The one million dollar question this time is: how can space support the financial and insurance sectors?
Claire Jolly, Head of Innovation Policies for Space and Oceans Unit at the Organisation for Economic Co-operation and Development (OECD), focused on green finance and investments to better manage environmental and social risks. When taking on investments for infrastructure works, the key question for investors is how they can be sure that their investment decisions are indeed green and sustainable. The Environmental Social Governance (ESG) criteria are a way to do exactly that. They are a set of standards for operations that investors use to assess sustainability. Data is key for this kind of exercise. Space can meet the high demand for indicators at all levels, from public institutions and the corporate world. According to the report of the UNDP Financial Centres for Sustainability, the market for ESG criteria has tripled in just five years. Especially, when it comes to environmental indicators such as carbon emissions, there are opportunities to use satellite data to help monitor pollution and changes in land use. The resulting information can help guide investment decisions, however, user capabilities and skills in processing and analysing this data represent a challenge.
For more information, you may access the presentation here.
Next, Valeria Catalano, EUSPA Market Development Officer, presented the EU Space programme and its applications in the Finance and Insurance markets. EUSPA is the European Union Agency for the Space Programme managing flagship space programmes like EGNOS and Galileo, GovSatCom, and Copernicus. The agency works around different market segments with the objective to increase the commercial use of space data. For the insurance and financing markets, two groups of applications can be identified. Earth observation applications, in particular Copernicus sentinel data, find their way into the risk assessment to retrieve what is called the event footprint. This is an application that compares insurance claims with the actual damages to determine the amount of compensation that has to be paid. In terms of numbers, it is a growing market that can reach 2031 around 1 million billion in total revenues. The second group of applications is related to the use of Global Navigation Satellite Systems (GNSS). Galileo is a valid time accurate timing source for the synchronisation of the network and financial transactions. An overview of all the applications and market segments can be found in the EUSPA Market Report.
For more information, you may access the presentation here.
Finally, Sascha Deutsch representing the ESA Commercialisation Gateway covered in his presentation the role of space in ESG. Space has the highest added value in the environmental part and can be a solution to the information asymmetry between investors and corporates. The main source of company-level ESG data is still voluntarily disclosed. This might cause issues with accuracy coverage and granularity. There is a need for more objective science-based data. A combination of machine learning and space-based infrastructure can provide better insights for the monitoring and evaluation of environmental footprints by looking at air pollution, water pollution, landscape change, biodiversity, etc. Today, publicly accessible satellite data merged with private constellations can provide inexpensive environmental data in high resolution. In contrast to ground measurements, Earth observation data can map and monitor changes in a scalable and economic way.
For more information, you may find access to the presentation here.
Key messages from the discussion:
- Dissemination is key to keep on raising awareness of applications and showing the value of Earth observation data in this market;
- Ensure that the data is easy to use by the intermediaries such as analytics companies building up the products on top of the satellite imagery that is then used by end users such as the banks and other finance companies;
- Practical training is needed on access to data, privacy regulations, and digital infrastructures.
Watch the full recording here
Would you like to do more on space and finance? Then do not hesitate to register for the Cassini Hackathons “Space for the Financial World” in November!
Don’t forget to register for our next Space 4 Critical Infrastructure webinar on the 27th of October!
