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The SDG Impact Analysis of Portfolios

Aug 23, 2017

The 2030 Agenda and its Sustainable Development Goals (SDGs), endorsed by all 193 UN member states in September 2015, reflect global priorities to address the world’s most pressing environmental, social and economic challenges. The 17 SDGs and the 169 targets strive for eradicating extreme poverty, achieving gender equality, ensuring access to water, making cities sustainable, or combating climate change and its impacts.

The Private Sector’s Engagement with the SDGs

The goals and targets of the SDGs have been developed through a broad process including representatives from governments, the private sector and civil society. While the formulation of the goals is targeted towards countries, actions and financial investments from the private sector are crucial to achieving the SDGs. The targets thereby provide an indication which issues the private sector needs to address to provide an added value to a specific SDG.
The World Investment Report published by the UN in 2014 highlighted an estimated investment gap in key SDG sectors of around 2.5 trillion USD annually, between 2015 and 2030 . The private sector therefore inevitably needs to take measures to contribute to solving the sustainability challenges. In doing so, profitable new business opportunities are likely to emerge. As SDGs act as a list of globally agreed goals, they are increasingly gaining importance for investors. Thus, investments in companies which contribute to the SDGs with their business activities may guide investors towards stable returns, assist them in representing the values of their clients and offer indications for sustainable and differentiated financial products.

Inrate’s SDG Impact Analysis

Inrate has long-standing experience with assessing the impacts of products and services on environment and society along their value chain. To allow our clients to access information on the impact of products and services of a company or a portfolio on the SDGs, we will be launching the “Inrate SDG Impact Analysis” by the end of the year. It will allow to measure companies’ positive and negative impacts on individual SDGs based on their revenues from specific products and services categories. Inrate thereby aims to provide a flexible and effective tool for reporting on a company’s or a porfolios’ performance regarding the SDGs.

 

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Financial market infrastructure provider SIX announced today the launch of a new climate data offering, aimed at supporting investors in reporting and monitoring of climate factors, and in climate-related investment and risk decision making.

The climate data sets, from various data providers in a range of industries, will provide clients with modelled and reported emissions data, covering over 33,000 companies globally, and bringing together multiple data sets on regulatory, historical and forward-looking climate impacts from providers including MSCI and Inrate. SIX also announced that it has recently entered into an agreement with environmental disclosure platform CDP to offer access to its global Greenhouse Gas (GHG) Emissions Dataset across various industries.

According to SIX, the new data sets come as investors increasingly require ESG and climate data to monitor investment decisions and to meet growing regulatory disclosure requirements, including the EU’s SFDR and the U.S.’ upcoming SEC Climate Disclosure Rules.

Martina Macpherson, Head ESG Product Strategy and Management, Financial Information, SIX, said:

“Understanding, measuring and managing climate risk and opportunities, as well as the impact that these can have on investment decisions, is a critical area of focus for market participants and policy makers alike. As more climate risk monitoring and reporting is required globally, the cost of compliance is increasing – both in operations and in terms of specialist ESG resources. SIX works with established providers of basic and specific ESG and climate data in the market.”