Moody’s takes a majority stake in climate risk firm Four Twenty Seven

Moody’s Corp. has acquired a majority stake in Four Twenty Seven Inc., a leading provider of data and analysis on physical climate risks, the company announced on Wednesday.

Moody’s said the acquisition solidifies its commitment to promoting transparent and globally consistent standards for evaluating environmental, social, and governance risks and opportunities.

Four Twenty Seven will keep its own name and become an affiliate of Moody’s Investors Service. It will continue to be headquartered in Berkeley, California.

“Four Twenty Seven has built a strong platform for quantifying climate-related exposures and producing actionable risk metrics, which are essential to understanding and informing climate risk and resilience measures,” said Myriam Durand, Moody’s global head of assessments. “Moody’s is committed to offering global, transparent standards for assessing environmental risk, and the acquisition of Four Twenty Seven advances our objective of integrating climate analytics into our offerings.”

Moody’s recently acquired Vigeo Eiris, a leading provider of ESG research, data and assessments.

“Moody’s global coverage and analytical capabilities, combined with Four Twenty Seven’s comprehensive climate risk data and intelligence, provides an ideal path to continue our work helping market participants integrate potential climate impacts into risk management and investment decisions,” said Emilie Mazzacurati, founder and CEO of Four Twenty Seven.

Moody's said the addition of Four Twenty Seven will enhance its growing portfolio of risk assessment capabilities and underscores its work to advance global standards for assessing environmental and climate risk factors.

Four Twenty Seven assigns scores to the physical risks associated with climate-related factors and other environmental issues. These include heat stress, water stress, extreme precipitation, hurricanes and typhoons and sea level rise. The scores, combined with portfolio analytics, quantify climate risk exposures globally across asset classes. It includes detailed data covering over 2,000 listed companies, one million global corporate facilities, 320 REITs, 3,000 U.S. counties and 196 countries.

“My work over the past years has been focused on helping financial market participants integrate climate analytics into risk management and investment decisions,” Mazzacurati said. “This partnership is a huge opportunity to mainstream climate change into risk management globally.”

The transaction was funded with cash on hand, but other details were not disclosed. However, Moody’s said it would not have a material impact on its 2019 financial results.