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ESG and sustainability integration

Most pension scheme sponsors face challenges from environmental, social and governance (ESG) factors – climate change in particular. While much thought has gone into identifying sustainable investment, trustees and sponsors are also now beginning to think about the impact of ESG risks on the employer covenant.

Assessing ESG risks

Here at Cardano Advisory, we are at the forefront of helping clients evaluate their ESG risks. We have developed innovative offerings in this area to support trustees and sponsors with practical steps to help them meet this challenge, whether that is helping to understand the possible impact of rising sea levels on operations, or government policy responses leading to higher operating and financing costs.


We can help you to navigate the risks and opportunities associated with ESG factors. Our primary service lines include:

  • training;
  • bottom-up analysis of ESG risks;
  • top-down reporting;
  • disclosure support;
  • bespoke regulatory support (such as TCFD reporting).

A dedicated sustainability practice

We are the only covenant advisory firm with a dedicated, stand-alone sustainability practice. We have worked together with leading climate-change academics to develop an award-winning climate risk model that breaks down the complexity of the ESG challenge in order to answer the following questions:

  • What risks could materialise? Are these climate risks e.g. weather events or transition risks e.g. social change?
  • Where are these risks likely to develop?
  • In what climate-change scenario are these risks most prominent?
  • How will these risks impact on all aspects of the sponsor’s value chain?
  • How extensive will the impact be from supply through to the consumer end-market?


Our proprietary model assesses the risks to every country across the globe and maps these risks to the location of the sponsor’s supply chain, operations and end markets to identify areas of primary concern. By distilling the process in this manner, we are able to highlight specific and targeted risks for sponsors, rather than broader, generic concerns.


This detailed analysis is the first of its kind and enables trustees to focus on areas of primary concern to them, and ultimately to work alongside sponsors to better understand the risks and mitigate them where possible.