The plethora of data sources and scores on sustainability makes it challenging to comply with Europe’s new regulations. An article by Investment & Pensions Europe (IPE) sums up how securities services firms are contributing to solutions.
The broad array of ESG metrics create a need for handling: first they need to be collected, then they need to be filtered and processed into something that makes sense and can be used as a basis for evaluation and investment decision making.
“What is different with ESG funds, is the lack of standardisation with the scores. It is difficult to get a broad perspective, which is why you need to work closely with data vendors and bring together all stakeholders,” says State Street’s Benjie Fraser, regional segment head for asset owners in Europe, the Middle East and Africa at State Street – one of many custodian representatives interviewed in the IPE article.
Institutions often put their ESG focus on their front office: on fund flows, strategies and research, IPE notes. “Often forgotten are the asset-servicing firms working in the wings developing solutions to help their clients evaluate, validate and comply with rules and regulations, particularly in Europe.”