CGFI Network Shock Model

The CGFI Network Shock Model, developed by the CFA Institute Research & Policy Center (RPC) in collaboration with the UK Centre for Greening Finance and Investment (CGFI), is an open-source platform designed to model systemic climate transition risks in interconnected financial systems. This tool enables policymakers, financial professionals, and researchers to analyze how risks propagate through financial networks under various climate scenarios.

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🌟 Key Features

• Systemic Risk Analysis: Evaluate cascading effects of climate transition risks across financial institutions.
• Scenario Testing: Simulate diverse climate transition scenarios to assess vulnerabilities and potential impacts.
• Open Collaboration: Transparent codebase inviting contributions from a global community of finance and tech experts.
• Live Demo: Explore the tool in action with our live demo.

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📚 Research Foundation

This tool is grounded in the research report "Modeling Climate Transition Risk: A Network Approach". Key highlights include:

1. Identifying Vulnerable Nodes: Pinpoint areas of high exposure in financial systems.
2. Scenario-Based Stress Testing: Model the propagation of transition risks through interconnected systems.
3. Actionable Insights: Provide recommendations for policymakers and investment professionals to mitigate systemic risks.

For a comprehensive understanding, read the full report here.

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🚀 Getting Started

Prerequisites

• Ensure you have yarn installed. For installation instructions, visit Yarn Documentation.

Installation

1. Clone the repository:

   git clone https://github.com/CFA-Institute-RPC/cgfi-finshock.git
   cd cgfi-finshock

2. Install dependencies:

   yarn install

Building the Project

To build the project, run:

yarn run build

The output files will be located in the /dist directory.

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🛠️ How to Contribute

We welcome contributions to enhance and expand the CGFI Network Shock Model. Here's how you can help:

1. Review the Contributing Guidelines.
2. Report Issues: Use the Issues tab to report bugs or suggest features.
3. Submit Pull Requests: Fork the repository, make changes, and submit a pull request for review.

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💬 Join the Community

Stay connected and collaborate with the RPC Labs community:

• GitHub Discussions: Ask questions and share feedback.
• Discord: Join our RPC Labs server for real-time discussions and support.

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👏 Acknowledgments

This project is supported by the UK Centre for Greening Finance and Investment (CGFI) and the dedicated contributions of researchers, developers, and the RPC Labs community. Special thanks to Raymond Pang and Gireesh Shrimali for their foundational research.

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📜 License

This project is licensed under the MIT License. See the LICENSE file for details.

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Let’s model a sustainable future together!