Risk assessment from space: Integrating satellite-derived insights for ESG financial decisions

Adriano Barasal Morales, Márcio Laurini and Anton Vrieling

Finance Research Letters, 2025, vol. 76, issue C

Abstract: This paper explores how satellite data can be used in sustainable investment analyses by offering a granular approach that differs from conventional environmental, social and governance (ESG) scores. The paper showcases the spatial relationship between abattoir locations and deforestation in Brazil, using asset-level and land coverage data to assess the environmental risks tied to beef traders’ sourcing practices. This approach provides a tool for investors concerned with climate risks who seek alternatives to existing ESG metrics. The findings highlight the benefits of integrating satellite data to comprehensively address material risks associated with some industries.

Keywords: Environmental risk assessment; ESG; Asset-level data; Spatial finance; Deforestation; Remote sensing (search for similar items in EconPapers)
JEL-codes: C11 C21 G14 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:76:y:2025:i:c:s1544612325002156

DOI: 10.1016/j.frl.2025.106951

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