Putting fisheries investment risk in perspective

Three billion people depend on seafood for their survival, and hundreds of millions depend on the oceans directly for their livelihood. Compared to business as usual, a global transition to sustainable fishing practices could result in a $14 billion USD increase in profits, 25 billion additional servings of seafood and 217 million more metric tons of fish in the sea—nearly a third more fish than exist today— if we can meet the imperative of the Paris Climate Accord and ensure global temperatures don’t rise beyond 2 degrees Celsius. The amount of investment needed to finance these reforms is estimated at $200 billion.

Risk—how to identify it, characterize it, and mitigate it—is a key barrier for financial institutions and capital markets to get involved in wild fisheries investments. To address this EDF teamed up with Credit Suisse’s Virtual Volunteering program to design a risk assessment tool that is typical for how risk is assessed in established asset classes.

The tool catalogues risk factors that are unique to fisheries into a highly customizable, Excel-based decision guide. The tool identifies a range of fisheries investment risk factors and helps analysts understand the potential impact of those risks on an investment. Furthermore, the tool suggests a suite of risk mitigation options to help investors address risks that are above a target threshold.

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