ESG Data Providers Challenged by Brussels
It took nearly three years after AFM and AMF, the Dutch and French market watchdogs, raised the alarm about the quality of ESG databases and conflicts of interest for Brussels to come up with the obvious: regulate and ask Esma to do so. The point is to look at ESG data providers as rating agencies and ask them to be transparent about their methodology black boxes. About time.
This pleases AlphaValue which noted, also three years ago, the absurd discrepancy of outcomes between the ESG data providers and as well as against its own results. AlphaValue's data sets are its own, filled up not by internet crawlers and strange averaging where data was missing but by its very equity analysts. They are constantly updated just as Financials are continuously updated. Even better, valuations are directly impacted by sustainability metrics (a subset of AlphaValue's ESG data).
To the best of our knowledge, no broker has reached that degree of consistency in embarking upon sustainability metrics in a disciplined way. It is even less the case for ESG data providers as they do not have financial projections.
AlphaValue's ESG metrics have been available over the last … 15 years and thus provide considerable depth when it comes to the only important item: the dynamic of that data. Admittedly, things accelerated four years ago when the environmental data started flowing in a more consistent and systematic way. This is when complex IT developments helped reach a live impacting of ESG data on target prices.
Agnostic and different
AlphaValue's motto is that a stock is nothing more than a financial asset, i.e. it should be arbitraged at will. This implies that its research tools have never been impressed by the idea of excluding stocks on some moral or environmental principle. Exclusion means investment silos and missing messaging. AlphaValue is agnostic about oils or tobacco as what is valued through their sustainability metrics is their progress. It happens that this works well, provided that this progress is assessed on a relative basis. Say ENI’s cut on its scope 1+2 carbon emissions needs to be set against its peers AND other alternatives (banks or luxury, etc.). For this complex set of computations to work, AlphaValue had decided well before the taxonomy Frankenstein merged from Brussels to rely on capital employed for its comparative live calculations. It works and it confirms to what extent ESG data is meaningless if not set against robust financial data.
This is what AlphaValue is proud of: adding independent sustainability analytics to its independent equity and credit research in a highly consistent and transparent way.
All AlphaValue's clients have a default access to ESG/Sustainability metrics. Some fund managers have already deployed those very tools in their own Article 8 type funds with regulatory approval.
AlphaValue's tools are absolutely independent and unconflicted. Fund managers with a genuine engagement about ESG principles have indeed noted that a starting point is independence.
This pleases AlphaValue which noted, also three years ago, the absurd discrepancy of outcomes between the ESG data providers and as well as against its own results. AlphaValue's data sets are its own, filled up not by internet crawlers and strange averaging where data was missing but by its very equity analysts. They are constantly updated just as Financials are continuously updated. Even better, valuations are directly impacted by sustainability metrics (a subset of AlphaValue's ESG data).
To the best of our knowledge, no broker has reached that degree of consistency in embarking upon sustainability metrics in a disciplined way. It is even less the case for ESG data providers as they do not have financial projections.
AlphaValue's ESG metrics have been available over the last … 15 years and thus provide considerable depth when it comes to the only important item: the dynamic of that data. Admittedly, things accelerated four years ago when the environmental data started flowing in a more consistent and systematic way. This is when complex IT developments helped reach a live impacting of ESG data on target prices.
Agnostic and different
AlphaValue's motto is that a stock is nothing more than a financial asset, i.e. it should be arbitraged at will. This implies that its research tools have never been impressed by the idea of excluding stocks on some moral or environmental principle. Exclusion means investment silos and missing messaging. AlphaValue is agnostic about oils or tobacco as what is valued through their sustainability metrics is their progress. It happens that this works well, provided that this progress is assessed on a relative basis. Say ENI’s cut on its scope 1+2 carbon emissions needs to be set against its peers AND other alternatives (banks or luxury, etc.). For this complex set of computations to work, AlphaValue had decided well before the taxonomy Frankenstein merged from Brussels to rely on capital employed for its comparative live calculations. It works and it confirms to what extent ESG data is meaningless if not set against robust financial data.
This is what AlphaValue is proud of: adding independent sustainability analytics to its independent equity and credit research in a highly consistent and transparent way.
All AlphaValue's clients have a default access to ESG/Sustainability metrics. Some fund managers have already deployed those very tools in their own Article 8 type funds with regulatory approval.
AlphaValue's tools are absolutely independent and unconflicted. Fund managers with a genuine engagement about ESG principles have indeed noted that a starting point is independence.
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