Blog — S&P Global Sustainable1 — 13 March, 2026
Beware of blind spots: How our asset-level data delivers a more complete view of physical climate risk
By Rick Lord, Kuntal Singh, and Bob MacKnight
Highlights
S&P Global Sustainable1 covers more than 7 million assets across critical sectors including energy, mining, real estate and shipping, mapped across the full corporate hierarchy to show where assets are located and who owns and operates them.
This high-resolution asset-level and ownership data provides a more complete view than approaches that use corporate headquarters as a proxy for asset location or exclude subsidiaries due to incomplete entity coverage.
Across several regional and global market indices, our analysis finds substantial financial impact driven by subsidiaries of index constituents. For example, we project $469 billion in annual climate hazard financial impacts for the S&P 500 by the 2050s; 44% of that total (more than $206 billion) is associated with the hazard exposure of assets held by subsidiaries of index constituents.
Climate change is contributing to more frequent and severe extreme weather events that can lead to loss of lives and property, damage to key infrastructure, disruption to supply chains, and threats to food and water security.
Corporates, banks, insurers and investors are increasingly seeking deep asset-level data to understand the geographic distribution of company operations and supply chains, and their exposure to climate-driven business interruption, property damages and costs globally. High resolution asset-level data must be paired with detailed corporate hierarchy and ownership information to reveal the flow of impacts within and between companies.
S&P Global Sustainable1 addresses this challenge by combining several essential inputs:
- Climate hazard data: We combine industry standard CMIP6 data with proprietary S&P Global models developed by our Climate Center of Excellence to map 10 core climate hazards across four scenarios and eight time periods for the entire world. This includes high-resolution, building-scale hazard data for flood at 30x30m resolution globally, and 90x90m for coastal flood outside the US.
- Corporate hierarchy and entity relationships: S&P Global Capital IQ offers comprehensive mapping of corporate hierarchies, inter-company relationships and business relationships via the Cross Reference Service.
- High-resolution asset-level location coverage: S&P Global Sustainable1 has complete coverage of material asset locations for more than 7 million assets. Our approach includes analyst validated coverage of material asset locations for more than 66,000 companies. Many providers cannot offer this complete level of coverage, leading to potential gaps, particularly in emerging markets.
Together, these datasets provide a clearer picture of the links between physical hazards and the specific assets and operations that could be exposed — improving decision-usefulness for risk management, investment research and disclosure. This same asset-location data can also inform real-time decision making in response to active events such as natural disasters, civil unrest or localized economic disruption — by helping users identify which facilities, sites and operational footprints may be in affected areas.
Beware of blind spots in other approaches
Not all approaches to asset-level climate risk analysis are equal. Location information pulled from company websites, annual reports and filings may be incomplete — particularly for complex corporate structures and global operating footprints.
Blind spot #1: Using headquarters as a proxy for asset location
One common shortcut is to treat a company’s headquarters location as representative of where its assets are located. For large corporates — especially multinationals — headquarters often have a limited relationship to where physical facilities, production sites, warehouses, stores or infrastructure actually operate.
As the map below demonstrates, focusing only on headquarters for companies in the S&P 500 misses a significant part of the geographic footprint for constituent companies.
Blind spot #2: Omitting subsidiaries and the assets they hold
A second blind spot can appear with an approach that only includes operated or directly owned assets in climate risk analysis. In practice, substantial climate financial risk exposure often sits in subsidiaries due to tax, regulatory, financing, joint venture structures or local operating requirements. Many asset datasets provide asset location, type and a single owner/operator. Without full hierarchy and ownership data, the picture can be incomplete and may contribute to biased conclusions in capital allocation and strategy.
S&P Global Sustainable1 data highlights that a substantial share of asset locations are linked through subsidiary ownership rather than direct ownership. Among S&P 500 constituents, for example, 48% of physical assets are owned via subsidiaries rather than direct ownership.
Further, our analysis finds that the S&P Global Sustainable1 approach of incorporating the full corporate hierarchy nearly doubles observable assets. This is true across several global and regional indices. For example, including subsidiaries of S&P 500 constituent companies increases asset coverage for the index by 1.93x.
To put a dollar figure on the potential blind spot, we examined the total financial impact of physical climate risk across several indices. For example, we project $469 billion in annual climate hazard financial impacts for the S&P 500 by the 2050s; 44% of that total (more than $206 billion) is associated with the hazard exposure of assets held by subsidiaries of index constituents. These projections are based on the S&P Global Sustainable1 Physical Risk dataset under a climate change scenario that assumes strong greenhouse gas emissions reduction (SSP2-4.5). These projections do not include adaptation measures.
These financial impact totals represent an accurate view of the physical climate risks companies in these indices face — across their full corporate structure, including subsidiaries.
Other approaches that are not based on measuring the exposure facing a company’s assets around the world typically assume that the climate physical hazard exposure of the country where it is headquartered or where it reports revenue is representative of the company’s entire operations. These approaches show significant variance from S&P Global’s asset level data methodology.
The table below shows estimated financial impacts derived using an asset-level method and compares them with estimates produced using several proxy methods. The proxy methods include headquarters-based proxies, headquarters-country proxies, revenue-weighted proxies, and direct-ownership proxies. The asset-level method allocates impacts across the complete mapped asset universe for each company and serves as the reference benchmark against which the proxy-based methods are compared. For illustrative purposes, one representative company from each sector in S&P 500 has been selected.
Physical climate risk analysis is only as strong as the underlying visibility into where assets are located and who controls them. S&P Global Sustainable1 maps assets throughout the corporate hierarchy, enabling a more comprehensive view of corporate asset holdings and their potential physical climate risk exposure. Our high-resolution approach improves coverage and provides a more decision-relevant foundation for assessing exposure, potential financial impacts and resilience over time.