GoldenSource has announced the addition of new capabilities and data sources to its GoldenSource ESG Impact solution, with greater access to raw ESG data, more nuanced portfolio screening and tuning, advanced analytics features including greenhouse gas (GHG) scenarios, and further support for the European ESG Template (EET).
The new capabilities offer enhanced analytics on top of the ESG data mastering, aggregation, standardization and storage features of GoldenSource ESG Impact. This includes the addition of ‘what if’ analytics, meaning that users will be able to analyze specific outcomes of potential investment shifts, such as swapping out or adding investments and the implications this would have for the overall portfolio ESG score. Topic tagging and template tagging simplify the generation of the EET for a firm’s products and the selection of products that fit a specific EET preference. Based on tagging, GoldenSource also mimics the SFDR Principal Adverse Impacts template, accelerating compliance with disclosure requirements.
A further example of the sophisticated analytics available, users can look at carbon emissions and physical risk under GHG climate warming scenarios as companies pledge commitment to reducing targets. Based on this, market participants can assess whether, when and how the company in question is contributing to net zero. And the new capability to aggregate this at a portfolio level will help firms assess overall impact.
Volker Lainer, VP of Product Management and Regulatory Affairs at GoldenSource said: “As all market participants face increasing pressures to be compliant with ESG regulations these new capabilities offer crucial insights and even more granularity when it comes to the sourcing, analyzing and application of data for ESG use cases across the business. GoldenSource ESG Impact continues to help firms make strategic investment decisions that will have long-term positive impacts, offer the best service to clients and fundamentally help to drive forward global sustainability initiatives.”
The new capabilities include additional screening and compliance features to support positive and negative assessments of how a company or investment is scoring. For negative screening, users can review information on product involvement, sanctions and controversies that may exist around the company in question, as well as the severity of the controversy and suspicious sources of revenue. As well as this, users can screen for positive activity including to what extent companies are involved with and contributing to global sustainable initiatives, such as the UN Global Compact. Users can also access data from the tool for portfolio tuning, with side-by-side comparisons of investments and companies with respect to scores as well.
Through GoldenSource ESG Impact, users can access scores, ratings and rankings from the broad range of sources and then drill down into the relevant underlying data points. This data is then standardized across the different providers, and subsequently mapped, supported, and used in business systems. This provides efficient and timely access to a broad range of raw ESG data, enabling users to make more accurate and credible business and investment decisions and ultimately enhance research and portfolio workflow.
All these features are supported by integrations with several additional data providers and more data from news outlets and social media, adding to the vast coverage already available through the tool for buy and sell side users. The tool is also flexible enough to adjust to new taxonomies, as and when they are introduced in multiple jurisdictions.
About ESG Portfolio Screening
ESG data types have been defined and used in the GoldenSource data model for a number of years. The native cross-referencing of data types in the model means that GoldenSource ESG Impact can look into a portfolio, through to the instruments it holds, on to the related issuing legal entities (at any hierarchical level of a group structure) and then into all related ESG data from all available sources. This can then be aggregated or rolled-up at any level, such that Portfolio Managers can screen the portfolio for all relevant ESG insights, status and changes in status (by comparing with historical data). GoldenSource is confident that this is a unique offering among ESG solutions.
Furthermore, within GoldenSource ESG Impact, despite the heterogeneous nature of ESG data, users can be confident in being able to compare all data that it is possible to compare, while avoiding mistaken comparisons between seemingly like but actually non-comparable data. This is because all the materiality maps that data providers produce are cross referenced within the system. This is another capability that is native to the GoldenSource platform, used widely for various classification and identifier taxonomies.