LEI data and climate finance: a step towards global sustainability

5 April 2022

In a world increasingly characterised by climate challenges, the Legal Entity Identifier (LEI) plays a crucial role in transforming financial markets towards greater transparency and sustainability. A remarkable initiative was presented during COP26: the partnership between the Global Legal Entity Identifier Foundation (GLEIF), Amazon, and OS-Climate. This collaboration aims to make LEI records accessible via the Amazon Sustainability Data Initiative (ASDI) open data catalogue to promote climate-focused financial applications.

The vision of the Amazon Sustainability Data Initiative

The Amazon Sustainability Data Initiative (ASDI) strives to revolutionise sustainability data analysis. Making basic data sets available in the cloud aims to reduce costs, time, and technical hurdles. By democratising data, ASDI empowers innovators and researchers worldwide to solve complex sustainability problems more efficiently. LEI datasets are an integral part of this, enabling companies to better assess their investments’ climate-related risks.

Why LEI records are crucial

The Legal Entity Identifier (LEI) enables the unique identification of legal entities and contains valuable information on the ownership structure. This transparency helps investors to assess sustainability aspects in their portfolios. For example, LEIs answer basic questions such as ‘Who is who?’ and ‘Who owns whom?’. This supports informed investment decisions and enables companies to pursue more responsible strategies.

Benefits of integrating LEI records into the cloud

The publication of LEI records via ASDI offers several advantages:

increased efficiency:

cloud-based storage reduces the time and cost of accessing vast amounts of data required for climate analyses.

regular updates:

new LEI data is provided every eight hours, guaranteeing timely availability

combination with other data sets:

LEI data is linked to extensive climate projections, historical weather records and satellite data, increasing the accuracy and reach of analyses.

Application in practice

Companies such as Allianz and BNP Paribas use LEI data to analyse the impact of climate change on their investments. Allianz integrates this data into risk models to develop more sustainable insurance and asset strategies. BNP Paribas is working on an open-source entity matching service that will democratise the creation of climate-related analyses.

Conclusion

Integrating LEI datasets into initiatives such as ASDI is a pioneering step towards supporting global sustainability and climate goals. By combining transparency, innovation and collaboration, this data enables more efficient assessment of risks and opportunities in climate-focused finance. Companies that integrate the Legal Entity Identifier into their strategies position themselves as pioneers in a sustainable future.