ESG Investor’s weekly round-up of news on technology and tools in the sustainable investing sector, including Verisk Maplecroft, Persefoni, Fair Cost Index, Scope Ratings, LPA, Globalance, GoldenSource, FactSet, ClimateWorks and Higg.
Global risk analytics company Verisk Maplecroft has launched Sovereign ESG Ratings to help investors manage and monitor ESG risks and opportunities across the sovereign issuer universe. The ratings have been designed to identify and track the sustainability factors with most impact sovereign debt markets. Research released to accompany the launch suggests human rights are highly material and that risks relating to the energy transition have become a key factor affecting countries’ borrowing costs. Verisk Maplecroft says the ratings will help investors to price in sustainability factors more effectively and create portfolios that tightly align with their values. The Sovereign ESG Ratings, which feature six years of quarterly historical data, draw on approximately 350 of Verisk Maplecroft’s 1200+ indicators across 37 separate issues and nine ESG dimensions. According to the firm, their methodology is based on cluster analysis and captures the non-linear complexity of the sovereign ESG world more effectively than traditional weighted averages.
SaaS-based climate management and accounting platform Persefoni has strategically partnered with Workiva, a regulatory, financial and ESG reporting platform, to provide transparent carbon disclosures to joint customers. The partnership will ensure clients are accessing transparent ESG disclosures alongside greenhouse gas (GHG) accounting to better track Scopes 1-3 emissions across both platforms. Users will be able to utilise activity data, carbon footprint calculations, climate trajectory models, secondary data sets, and operational, financial and supply chain data. “By partnering with Persefoni, we’re able to deliver investor and board-grade carbon data that can be used to make better decisions for businesses and the environment,” said Julie Iskow, Workiva’s COO. Joint users will also be able to use the Workiva Framework Explorer to compare data requirements across multiple existing frameworks, including the UN’s SDGs, the Task Force on Climate-related Financial Disclosures (TCFD) and the Global Reporting Initiative (GRI). “We’re excited about the value our partnership will create for our joint customers by easing the path to satisfying complex climate-related disclosure requirements,” said Kentaro Kawamori, CEO at Persefoni.
Index administrator Fair Cost Index (FCI) is to build a high-performance range of ESG equity indexes with European ratings agency Scope Group. The range will feature traditional parent indexes based on types of exclusions and ESG scores, with a ‘core’ sub-family adopting standard ESG characteristics and a ‘leaders’ sub-family retaining the highest scores of companies in their respective sectors. Other ESG indexes, based on clients’ specific requirements, also will be created. Dr François Chauvet, CEO, Founding Partner, FCI, said the partnership would enable the company to offer asset managers “ESG indices of gross added value”.
Capital markets technology and advisory firm LPA has entered into a partnership with sustainability reporting tool vendor Globalance to improve its ESG reporting services. Under the arrangement, LPA will gain access to Globalance World, a platform that gives free access to 6,000 listed companies and selected stock indices related to ESG, climate change and megatrends. The interactive platform enables users to analyse and assess the future orientation and sustainability of these companies. Globalance World will be integrated with LPA’s compliance and regulatory reporting platform, Capmatix Regulations. Stefan Lucht, Founder and Managing Partner at LPA said the company’s banking and asset management clients were increasingly asking for deeper and more meaningful ESG insights, in order to properly market sustainable investments.
Data management company GoldenSource has integrated ESG content from global information provider FactSet into its GoldenSource ESG Impact product. The product also will be listed on the Open:FactSet Marketplace. Todd Hartmann, Senior Director, Product Management, at FactSet, said the inclusion of GoldenSource ESG Impact on the marketplace would give investment professionals the “opportunity to take advantage of a centralised data tool for a whole portfolio view when undertaking ESG data analytics and reporting”. GoldenSource’s application will complement FactSet’s symbology offering, which links data sets such as Company Fundamentals and ESG. If a portfolio manager needs to replace an investee in their portfolio because its ESG scores are too low, they can easily identify another company that has appropriate ESG metrics and the underlying financial fundamentals that justify an investment. Previously, this match-making process was a significant challenge, said the two companies.
A group of organisations led by the ClimateWorks Foundation are collaborating on an initiative designed to accelerate the development of reliable and interoperable carbon emissions accounting. The Carbon Call mobilises collective action, investment and resources from scientific, corporate, philanthropic and intergovernmental organisations to enable access to reliable and up-to-date data that can be easily exchanged among carbon accounting systems. Supporting organisations include Microsoft, the UN Environment Programme, Linux and Capricorn Investment Group. The Carbon Call aims to uncover and address gaps in existing global carbon accounting systems, focusing on carbon removal and land sector, methane and indirect emissions. It will work collectively to identify where more accurate information is needed to improve reliability and advance interoperability by design, both in carbon accounting reports and the data ecosystems that support them.
US-based sustainability insights platform Higg has released new social and labour performance benchmarks for consumer goods manufacturing. The platform offers performance measurement for manufacturing facilities across carbon, water, waste, and now working conditions. Higg users can compare the environmental and social impact within their own value chain and against industry peers, giving businesses “a new perspective” on their performance and informing strategic decisions to meet sustainability goals. “To create better conditions for workers in the fashion industry, businesses need data they can trust and Higg is helping make this possible by providing industry access to the SLCP’s Converged Assessment Framework (CAF). The CAF is a widely accepted tool designed to reduce audit fatigue and increase facility ownership of their social and labour data,” Janet Mensink, Executive Director of the Social & Labour Convergence Program said.