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Mitigating Sustainability And Climate Risks With Asset Investment Planning Software

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Mitigating Sustainability And Climate Risks With Asset Investment Planning Software

ESG and sustainability have risen up the corporate agenda, due to pressure from financial markets, new policies and voluntary commitments. In the 2021 Verdantix operational excellence corporate survey, firms stated lean, safe and sustainable industrial operations as the top three priorities to improve in 2022. By using asset investment planning (AIP) software to make data driven decisions, firms can have a clear view of investment strategies and the benefits from a financial, environmental, and social point of view. This is driving demand for AIP software which is forecasted to grow at a CAGR of 13% by 2026. How can firms achieve their sustainability KPIs with AIP software?

With rising energy demands and climate change mandates affecting every business decision, making new investment decisions especially for the long term has never been more challenging. Customers now demand more comprehensive workflows for long term investment planning, a greater number of benchmarkable metrics and the ability to assess social and environmental benefits on the same level as economic gains. AIP software enables firms quantify a range of sustainability and non-financial factors such as health and wellbeing of employees, environmental impact, risks to local communities, and changes in government policy to simulate multiple scenarios and understand their impact on repair or replace investment decisions. By doing so, firms can optimize capital plans to achieve net zero goals as quickly and cost-effectively as possible. Through the use of Copperleaf’s decision analytics suite, National Grid is incorporating sustainability metrics to minimize the impact of investments on the environment, while ensuring safe, reliable and affordable electricity.

The recently proposed rule changes by the US Securities and Exchange Commission (SEC), will require firms to include information about climate-related risks in their statements and periodic reports. AIP software can include climate risk metrics such as probability of flooding into the decision-making framework. AECOM partnered with Probit Consulting, an AIP specialist, to develop an offering to improve traditional inflow and infiltration management methodologies by reducing costs and decreasing flood and overflow risks to municipalities. Northumbrian Water Group, implemented Arcadis Gen’s EDA software to understand the impact of long-term investment over 25 years, on collapsed sewers, blockages, flooding and pollution.

To learn more about AIP software and the market opportunity, read the following Verdantix reports: Smart Innovators: Asset Investment Planning SoftwareMarket Size And Forecast: Industrial Asset Management Software 2021-2026 Global and Strategic Focus: High Value Use Cases And Benefits Of Asset Investment Planning Software.
Analyst

Kiran is an Industry Analyst in the Verdantix Operational Excellence practice. His current research agenda focusses on emerging solutions and global market trends across the process industries. Prior to joining Verdantix, Kiran worked at Siemens PSE where he gained experience in advanced process modelling and digital twin technologies. Kiran holds a MEng in Chemical Engineering from the University of Nottingham.