ESG Investor’s weekly round-up of news on technology and tools in the sustainable investing sector, including Carbon Tracker, Sustainable Fitch, Apex Group, ACA Group, Euroclear, and ISS ESG.
Climate and financial markets think tank Carbon Tracker has developed a Global Registry of Fossil Fuels. It will serve as a public database of emissions from fossil fuel reserves and production worldwide, tracking their impact on the global carbon budget. The registry currently contains data for over 50,000 fields in 89 countries, covering 75% of global production. It will later will be extended to include economic attributes, including taxes and royalties associated with specific assets, that could factor into decision-making on how to manage a phase-out of supply. Inger Andersen, the UN Environment Programme’s Executive Director, said: “The Global Registry of Fossil Fuels is an important step in providing insights to policymakers and investors as we embark on a just transition away from fossil fuels.” Mark Campanale, founder of Carbon Tracker and Chair of the Registry Steering Committee, said: “The Global Registry will make governments and companies more accountable for their development of fossil fuels by enabling civil society to link production decisions with national climate policies. Equally, it will enable banks and investors to more accurately assess the risk of particular assets becoming stranded.”
Sustainable Fitch, an ESG ratings firm, has launched its ESG Ratings product for investors. ESG Ratings, Data & Analysis will offer granular ESG ratings and sub-scores at an entity, framework and instrument level. It will help investors distinguish between ESG impacts, outcomes and performance at a detailed individual factor level. The ratings also offer the capability to compare individual characteristics of entities and debt issuance between organisations within the same sector, across different sectors and across asset classes. Andrew Steel, Managing Director of Sustainable Fitch, said: “Investor demand for more detail and clarity in ESG continues to grow. Sustainable Fitch’s ESG Ratings allow investors to both evaluate and distinguish ESG impact, outcome and performance at a detailed individual factor level.”
Apex Group, a global financial services provider, has expanded its ESG offering with its new Impact Positive Solution for investors and companies seeking to measure and drive positive change. Apex’s Impact Positive Solution will utilise a five-step process to support investors, and their underlying portfolios, to identify material impacts, and select tailored KPIs. The five steps include a ‘do no significant harm’ assessment and exclusion screening, regular data collection through Apex ESG’s online platform, and independent data verification by ESG analysts to ensure impact integrity. This product is launched as part of Apex Group’s ESG Impact Month, an initiative to drive accountability for ESG in the financial services space, aiming to raise awareness of ESG issues in the financial services space. Andy Pitts-Tucker, Apex’s ESG Managing Director, said: “With the expansion of our ESG offering we hope to address the challenges and hurdles faced by investors across the financial services industry, enabling us all to make a positive impact on the world and drive constructive change for many years to come.”
Global governance, risk and compliance (GRC) firm ACA Group has acquired ESG data specialist Ethos ESG. The acquisition will aid ACA’s efforts to support the investment management industry with its increased ESG regulatory requirements. Founded in 2019, Ethos is an interactive platform that evaluates over 350,000 impact ratings for companies, stocks, and funds through a prism of 45 ESG-related themes, including climate change, racial justice and mental health. Ethos’ integration will allow for GRC professionals to understand the ESG characteristics of their investments and make responsible decisions that align with their firm’s values and ESG commitments, ACA Group said. CEO Shvetank Shah said: “We are invigorated to be building out and launching our data capabilities, starting with Ethos ESG. Combining data with our scalable solutions will continue to empower our clients to reimagine GRC and protect and grow their business.”
Global market infrastructure operator Euroclear has invested in ESG tech-enabled analytics and data science solutions firm Impact Cubed. Impact Cubed supports investors by enabling them to compare a security’s exposure to sustainability themes, providing them with decision-useful information. This investment follows Euroclear’s strategic stake in Greenomy earlier this year, which supports issuers by digitising the data capture and reporting process to comply with EU sustainable finance legislation. Euroclear noted that Greenomy’s issuer-centric reporting capability and Impact Cubed’s investor-centric data capability align with Euroclear’s objective to connect issuers and investors and integrate sustainable data and analytics into its ecosystem. Libby Bernick, Impact Cubed’s CEO, said: “Euroclear’s network and infrastructure will provide better transparency on the impact of investments across capital markets. Together with Euroclear, we aim to increase the adoption of tech-enabled approaches using factual ESG data to ensure investors gain better insights.”
ISS ESG, the responsible investment arm of the US-based Institutional Shareholder Services (ISS), has launched a Biodiversity Impact Assessment Tool. It will support investors looking to align with rapidly evolving voluntary and statutory biodiversity disclosure frameworks and to better understand the impacts of their investment portfolios on biodiversity. The tool leverages a bottom-up assessment of companies’ business activities and supply chains to demonstrate the impact of their operations on biodiversity. The assessment also includes the provision of two main biodiversity indicators in potential Disappeared Fraction of species, as part of the Life Cycle Assessment and Mean Species Abundance. The Biodiversity Impact Assessment Tool coverage will include 7,400 issuers, the same as ISS ESG’s Corporate Rating Universe. Dr Maximilian Horster, ISS ESG’s Head, said: “ISS ESG’s new tool’s comprehensive package of biodiversity datapoints and robust impact assessment methodology helps investors to measure their portfolios’ biodiversity impact and address imminent and evolving regulatory reporting requirements globally.”