New Financial Services

Sensing Natural Capital

Environmental sensor data for the financial sector

A $329 000 project involving University of Tasmania researchers from the School of Social Sciences' Institute for the Study of Social Change, IMAS and the Tasmanian School of Business and Economics, in collaboration with with Peking University Guanghua School of ManagementNational Australia Bank, Global Surface Intelligence (GSi) and the Climate Disclosure Standards Board.  

The project aims to help standardise the way environmental sensor data is collected, processed and presented, such that it can meet the needs of financial sector users.


Background

Financial sector interest in natural capital – the natural assets that provide ecosystem goods and services that underpin the economy and well-being of society in general – has increased sharply in recent years, as the financial implications of under-valuing natural capital have become more apparent. At the same time, the combination of progress in sensor technology (lower costs, reduced size, increased capabilities) with ever-increasing data storage and processing capacity has opened up the possibility of widespread real-time environmental monitoring. The possibility now exists of directly sensing natural capital in ways that can be used by the financial sector, whether as an input to investment opportunity and risk analysis, monitoring performance, or enabling entirely new markets in environmental commodities or attributes, such as carbon offsets or sustainable labels. 

However, at present, both the potential role of environmental sensor data in the financial sector and its implications are poorly understood. Much 'environmental Big Data' is already available, but not being collected, processed or presented in a way that meets the needs of financial sector users. The Sensing Natural Capital project aims to improve our understanding of these needs and potential applications in the financial sector. The ultimate objective is to help promote appropriate valuation of natural capital in the financial sector by promoting a more standardised approach to the collection, processing and presentation of environmental data.


What we are doing

The project is being conducted over two phases. Phase I aims to clarify the potential applications of 'environmental Big Data' in the financial sector, and the requirements and limitations the sector's needs might place on the underlying collection, processing and presentation of environmental data. The outputs from this phase are summarised in a Draft Report for industry and other stakeholders, which will be discussed at a Stakeholder Workshop in Hobart, Tasmania on 11-12 February 2016. Phase I activities include:

Phase II of the project (Mar-Dec 2016) will be to develop guidance for more standardised environmental sensor data collection and processing to meet the needs of financial sector users, based on inputs from key industry, government and NGO stakeholders.


Early Findings

There is currently no clear guidance for environmental data collection, processing and presentation which reflects common requirements (for example around traceability and auditability) arising from the needs of the financial sector. By developing a better understanding of these requirements, we have identified a number of potential problems and will work to help organisations avoid investing in environmental data infrastructure that does not meet financial sector needs.


Our team

Dr Francisco Ascui is an international consultant in energy and carbon markets, Senior Lecturer at the University of Edinburgh Business School and Adjunct Senior Lecturer at the Tasmanian School of Business and Economics (TSBE) at the University of Tasmania.

Assoc Prof Heather Lovell is an Australian Research Council (ARC) Future Fellow (2015-19) and Associate Professor in the School of Social Sciences at the University of Tasmania.

Assoc Prof Fred Gale is an international specialist in environmental and sustainability governance located within the politics and international relations discipline within the University of Tasmania School of Social Sciences.

Prof Marcus Haward is a political scientist specialising in oceans governance and marine resources management at the Institute for Marine and Antarctic Studies (IMAS) at the University of Tasmania.

Anna Farmery is currently completing a PhD through the Institute for Marine and Antarctic Studies (IMAS) at the University of Tasmania, on seafood supply chains and their role in sustainable food systems and food security.

Dr Ainsley Elbra is a researcher in the field of international political economy, focusing on globalisation, private governance and business-state relations.


About Sense-T's Industry Research Projects

Sense-T's Sensing Natural Capital project is among 14 Industry Research Projects currently being undertaken. 

The projects have received funding of $6 million from the $13 million provided to the University of Tasmania for Sense-T by the Australian Government through the Tasmanian Jobs and Growth Plan, with a further $5 million contributed by our research and industry partners.


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