Investment manager Man Group has established a dashboard-style tool designed to monitor financial risks and environmental, social and governance factors across single issuers, portfolios and indices.
The company said the new instrument, Man Group ESG Analytics, will further enhance its responsible investment capabilities, with stewardship data and a real-time overview of a portfolio’s proxy voting performance and statistics.
The dashboard uses a proprietary ESG scoring system derived from quantitative investment division Man Numeric’s data research.
The system, Man Group said, applies data science and quantitative analysis to disaggregate multi-vendor ESG datasets. It aims to generate a holistic score for the sustainability profile and impact of a business.
Datasets from three ESG data providers, Sustainalytics (ESG scoring and controversies data), MSCI (ESG scoring) and Trucost (environmental information) will also be integrated into the platform, which Man states will let portfolio managers evaluate a wide variety of company-specific metrics.
Investment teams will be able to look at data from a company, portfolio and index level, with the goal of making it easier to identify potential ESG risks. The dashboard will also display voting activity, reflecting the degree of fund-level engagement by Man Group’s investment teams.
The tool was developed under the direction of the group’s Responsible Investment team, with collaboration between Man Numeric and the risk and performance analysis, and stewardship teams.
Jason Mitchell, co-head of responsible investment at Man Group said sophisticated approaches and advanced analytics are vital to identify and understand ESG.
“Man Group ESG Analytics represents three important accomplishments for Man Group: first, it helps demystify and organise the complexity of ESG data for our investment teams and clients,” Mr Mitchell said.
“Second, it allows us to take an innovative approach to ESG reporting in advance of inevitable regulatory and statutory ESG reporting requirements; and lastly, Man Numeric’s development of a proprietary, uncorrelated ESG factor provides a necessary way for us to not only understand, but ultimately to better measure and manage ESG risks.”
Rob Furdak, co-chief investment officer at Man Numeric, added that one of the main challenges that managers face when incorporating responsible investing into their processes is that ESG data is “messy and subjective”.
“Man Numeric’s ESG team has undertaken a stringent process to understand the unique qualities of this data and develop a multi-source, industry-based view of ESG,” Mr Furdak said.
“We are excited by the launch of the ESG Analytics tool and the opportunities this represents for us as a firm.”
The development of the ESG Analytics tool follows the introduction of Man Group’s RI Fund Framework, a formalised structure that quantifies the degree of RI focus for all Man Group funds; and the Man Group RI Exclusions List, a proprietary list of sectors and companies ineligible for the firm’s portfolios.
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
Sarah has a dual bachelor's degree in science and journalism from the University of Queensland.
You can contact her on [email protected].
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