Dear all,

we've started  releasing bits and pieces of a new open source tool we are building (the Solstice simulation framework) on our github repo and more is comming over the next weeks. You can check out the first installment of the Solstice manual which describes the analytic framework behind Solstice. 

The analytic framework has the following core components:

• A representation of economic entities as property graphs (nodes and edges with associated attributes) as discussed in our earlier white papers (number 8 and 10 in particular)
  
• A representation of network-wide factors and dynamics drivers as macro variables
• Sources of uncertainty (both macro (system-wide) and idiosyncratic (entity-specific)
• A discrete temporal grid where future states of the economic network and (any) macro variables are modeled
• Network evolution along the temporal grid due to both deterministic and stochastic elements that follows by a variety of risk distributions / models using potentially a combination of model components (satellite models)
• Bottom up composition of network state changes using elementary "system updates"
• Ability to condition on specific realizations of (in particular) macro factors, which emulates scenario analysis / stress testing
• Introducing special entities that interact with the network in systemic ways (e.g. financial intermediaries, sovereigns or regulatory entities) with specialized internal states
• Collection of sampling statistics of network evolution and distillation of useful risk metrics and reports

If you are interested to use and/or contribute to our open source projects please follow and star them on github and (if appropriate) raise issues with ideas or functionality that you would like to see.

Adressing sustainability is a major challenge (and opportunity) facing portfolio managers in diverse domains. If sound financial portfolio (and risk) management was not already enough of a challenge, integrating totally new and diverse data streams about environmental impacts, new objective functions that go beyond monetary measures, new and evolving environmental policies and targets is a major journey that has barely begun.

Some Academy users might be already familiar with  equinox, our open source sustainable portfolio management platform. In a new series of blog posts we explored how it can be used to support sustainable procurement management. In procurement, the financial portfolio is a collection of contracts where the counterparties are various suppliers of goods, works or services.

The use case is built around the TED, an Open Data database In the European Union that is the pre-eminent platform collecting data about public procurement. In the first post we explore the overall shape of the dataset which is quite large (over three millions of contracts between 2017-2021)!

In the second post we dig deeper into important facets of the data, with the aim of constructing a meaningful economic representation of the public procurement process. Most importantly this involves identifying who is the procurement manager and who are their counterparties. The geographic distribution of contracting entities cover the entire European region (every NUTS3 region)

In the third part of this series we illustrate how one may assign greenhouse gas emissions (GHG) to public procurement using environmentally extended input-output models. Public procurement represents final demand of the public sector (which ultimately provides services to households). Towards that end we adopt datasets produced by Eurostat as the basis for the GHG attribution. Specifically, Eurostat produces the statistics with a production and consumption perspective and re-publishes the territorial statistics of the European Environmental Agency (EEA). For this exercise we utilized emissions intensity estimates.  As outcome we can generate a variety of reports and visualizations, such as a sector-by-country grid of attributed emissions:

Finally, we conclude the discussion with an overview of the conceptual data models involved and future applications that may involve additional geospatial data linked to emissions sources.

Enjoy!

We are very happy to announce that our EU Datathon 2022 proposal based on the Equinox platform has been pre-selected to enter the formal stage of the competition

The EU Datathon is an annual Open Data competition organised by the Publications Office of the European Union since 2017. The competitions are organised to create new value for citizens through innovation and promoting the use of open data, in particular the datasets available on the official portal for European data

As Open Risk we submitted a proposal under Challenge 2 (Transparency in Public Procurement) that aims to integrate the rich dataset of the TED (Tenders Electronic Daily) dedicated to European public procurement into Equinox, thereby offering an innovative and powerful platform that supports green public procurement using the full machinery of Sustainable Portfolio Management.

We are very happy to announce that the proposal has been pre-selected to enter the formal stage of the competition!

Are you interested in topics around sustainable finance and portfolio management? Your feedback, ideas and contributions, whether technical or non-technical are welcome for example:

• in on our github repository where the development of equinox happens as an open source project
• at the Open Risk Commons

• Check out the Sustainable Finance knowledge base at of the Open Risk Manual
  
• Enroll at the Introduction to Input-Output Models using Python course here at the Open Risk Academy
• Study a theoretical framework and White Paper focusing on sustainable portfolio management concepts