Despite being a growing reservoir of funds under management, this critically important pool of capital is confronting mounting problems collating and disseminating key data in a timely manner.
The ratings house is pinning its growth strategy on a revamped methodology that increases the emphasis on governance to 25 per cent – a timely move considering APRA’s proposed reforms.
Global custodian wraps ESG data in new client tool
(pictured: Patrick Colle)
BNP Paribas Securities Services (BNP) has rolled out a responsible investment tool, tapping into a burgeoning demand for the service from global institutional investors.
The new ESG (environmental, social and governance) Risk Analytics system analyses up to 750 data points for every company in its database, BNP said in a release last week.
Based on the “comprehensive, granular and independently sourced data”, the BNP system creates an overall ESG score for client portfolios, which can also be broken down “to country, sector and individual security level”, the statement says.
Patrick Colle, BNP Securities Services general manager, said the new ESG Risk Analytics tool would “help institutional investors overcome obstacles and incorporate ESG into their everyday investment decisions”.
Colle said while responsible investing was almost de rigueur for institutions today, “putting an ESG-aware investment strategy into practice can prove difficult”, particularly with data-collection and analysis.
“Managing this data, analysing it and presenting it in a clear, concise and easily digestible way is the core of what the ESG Risk Analytics solution provides for clients,” he said in the statement.
While ESG investing has accelerated offshore over the last couple of years, a recent Investment News NZ/BNP Paribas survey found the topic was well-down the list of priorities for New Zealand investors.
Compared to respondents to a similar Australian survey, NZ investors were less likely to increase their focus on ESG issues in the year ahead, the report found.
The Responsible Investment Association Australasia is due to release its benchmark report on the NZ market later this month.
Despite the to-date lack-lustre local demand for ESG-focused investments (especially outside the big Crown Financial Institutions), the responsible investing trend is still washing over NZ.
For example, after stitching up a deal with global ESG specialist, Sustainalytics, in 2015, research house Morningstar has since extended the analysis to the NZ funds market, ranking 44 products according to the criteria in its first take.
– David Chaplin, Investment News NZ
