Skip to main content
https://www.highperformancecpmgate.com/rgeesizw1?key=a9d7b2ab045c91688419e8e18a006621

Fund managers can leverage ESG-related data to generate insights

Georges Archibald Contributor
Georges Archibald is head of Americas at the Apex Group.

Almost two centuries ago, gold prospectors in California set off one of the greatest rushes for wealth in history. Proponents of socially conscious investing claim fund managers will start a similar stampede when they discover that environmental, social and governance (ESG) insights can yield treasure in the form of alternative data that promise big payoffs — if only they knew how to mine it.

First, let’s be clear: ESG is not on the fringe.

There may be some truth to that line of thinking if you take some of the rhetoric and advertising out of the equation.

First, let’s be clear: ESG is not on the fringe. The European Union has implemented new financial regulations via the Sustainable Finance Disclosure Regulation (SFDR). These improve ESG disclosures and considerations and help to direct capital toward products and companies that benefit people and the planet. As we write, the U.S. Securities and Exchange Commission is also considering drafting and implementation of ESG-related regulations.

Whether enacted or currently under consideration, these rules encourage fund managers to integrate sustainability risks into their business processes, report on them publicly, stamp out greenwashing, and promote transparency and knowledge among investors. Accordingly, it will become easier to compare firms’ sustainability efforts, too, allowing stakeholders from all corners to make more informed decisions.

Incorporating ESG factors into investment strategies is not new, of course. The world’s largest asset managers have been practicing it for years. According to the Governance & Accountability Institute, 90% of companies listed on the S&P 500 now produce sustainability reports, an increase of 70 percentage points from more than a decade ago.

Yet some are still groaning about adopting an ESG investing mindset; they see ESG as a nuisance that detracts from their mission of earning high returns. But could this mindset mean they are missing important opportunities?

Don’t wait

Waiting for new mandatory ESG reporting and compliance framework standards in the U.S. puts Americas-focused managers at a significant disadvantage. Fund managers can start gaining insights today from alternative data originating in ESG-related data stemming from climate change, natural disasters, harassment and discrimination lawsuits, and other events and information that can be mined.

Comments

Post a Comment

Popular posts from this blog

Uber co-founder Garrett Camp steps back from board director role

Uber co-founder Garrett Camp is relinquishing his role as a board director and switching to board observer — where he says he’ll focus on product strategy for the ride hailing giant. Camp made the announcement in a short Medium post in which he writes of his decade at Uber: “I’ve learned a lot, and realized that I’m most helpful when focused on product strategy & design, and this is where I’d like to focus going forward.” “I will continue to work with Dara [Khosrowshahi, Uber CEO] and the product and technology leadership teams to brainstorm new ideas, iterate on plans and designs, and continue to innovate at scale,” he adds. “We have a strong and diverse team in place, and I’m confident everyone will navigate well during these turbulent times.” The Canadian billionaire entrepreneur signs off by saying he’s looking forward to helping Uber “brainstorm the next big idea”. Camp hasn’t been short of ideas over his career in tech. He’s the co-founder of the web 2.0 recommendatio...
Post a Comment
Read more

Leading VCs discuss how COVID-19 has impacted the world of digital health

In December 2019, Extra Crunch spoke to a group of investors leading the charge in health tech to discuss where they saw the most opportunity in the space leading into 2020 . At the time, respondents highlighted startups in digital therapeutics, telehealth and mental health that were improving medical practitioner efficiency or streamlining the distribution of care, amongst a variety of other digital health markets that were garnering the most attention. Where top VCs are investing in digital health In the months since, the COVID-19 crisis has debilitated national healthcare systems and the global economy. Weaknesses in healthcare systems have become clearer than ever, while startups and capital providers have struggled to operate while wide swaths of the market effectively shut down. Given significant volatility and the rapid changes seen in the worlds of healthcare, venture and startups broadly, we wanted to understand which inefficiencies might have been brought to light, w...
Post a Comment
Read more

News-reading app Flipboard expands local coverage, including coronavirus updates, to 12 more U.S. metros

Earlier this year, personalized news aggregation app Flipboard expanded into local news . The feature brought local news, sports, real estate, weather, transportation news and more to 23 cities across the U.S. Today, Flipboard is bringing local news to 12 more U.S. metros and is adding critical coronavirus local coverage to all of the 35 supported locales. The 12 new metros include the following:  Baltimore, Charlotte, Cleveland, Detroit, Indianapolis, Nashville, Pittsburgh, Orlando, Raleigh, Salt Lake City, St. Louis, and Tampa Bay. They join the 23 cities that were already supported:  Atlanta, Austin, Boston, Chicago, Dallas, Denver, Houston, Las Vegas, Los Angeles, Miami, Minneapolis-St. Paul, New Orleans, New York City, Philadelphia, Phoenix, Portland, Sacramento, San Diego, San Francisco Bay Area, Seattle, Toronto, Vancouver and Washington, D.C. To offer local news in its app, Flipboard works with area partners, big and small, like The Plain Dealer’s Cleveland.com , ...
Post a Comment
Read more