The Physical Climate Risk Appraisal Methodology (PCRAM) 2.0

The Physical Climate Risk Appraisal Methodology (PCRAM), formerly known as the Physical Climate Risk Assessment Methodology, provides systematic, objective, and replicable guidelines for integrating physical climate risks into investment decision-making. It is a practical guide for understanding and managing the physical climate risks that climate change poses to real assets, appraising the adaptation options and linking it back to asset values.

PCRAM 2.0 combines climate science, engineering, and finance to present a robust approach, adaptable to individual contexts. This updated version can help investors, asset managers, and developers make better decisions by factoring in physical climate risks, such as floods, heatwaves and storms. Looking beyond risk, it can support investors to identify resilience investment opportunities according to financial materiality.