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  "documentTitle": "Sustainability Risk Under Solvency II",
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      "text": "For a complete assessment, secondary exposures on the equity or credit risk side also have to be taken into account.",
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      "text": "In general, primary exposure exists towards sectors whose business is directly affected by climate policy. Secondary exposures exists via holdings within the financial sector (banks, insurances and pension funds), which in turn are exposed towards climate policy via direct holdings or counterparty risk.\nThis secondary risk is generally considered to be material. This may also be checked on an individual basis, provided that the respective data is available.\nThe academic literature typically assesses the secondary exposures with respect to the Climate Policy Relevant Sectors (CPRS) already introduced previously. Given respective portfolio data, NACE and CPRS can be mapped to each other.\nOn the more pragmatic side, secondary risk can either also be assessed on the basis of existing academic studies or regression approaches on equities using previously calculated impacts as explanatory variables.\nThe upcoming EU Taxonomy for Sustainable Finance is expected to significantly improve the amount of available data particularly with respect to secondary exposures.",
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      "text": "For a complete assessment, secondary exposures on the equity or credit risk side also have to be taken into account. This can either be done via direct mapping or estimate based on existing studies or regression models.",
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      "text": "1. EIOPA, Second Discussion Paper on Methodological Principles of Insurance Stress Testing, (June 2020)\n2. Battiston et al., A climate stress-test of the financial system, (2016)\n3. EU Technical Expert Group on Sustainable Finance, Taxonomy Report and Technical Annex, (June 2019/March 2020)",
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