Bringing you live news and features since 2006 

Oak tree

The right stuff: Solactive invests in scientific climate data start-up

RELATED TOPICS​

German-based index provider Solactive has concluded its strategic investment in scientific climate data start-up right. Timo Pfeiffer, Chief Markets Officer at Solactive, explains that what made right. right, was their approach to ESG data.

German-based index provider Solactive has concluded its strategic investment in scientific climate data start-up right. Timo Pfeiffer, Chief Markets Officer at Solactive, explains that what made right. right, was their approach to ESG data.

“We have strong fundamental beliefs in ESG and a strong focus on interesting data points that are becoming more relevant combined with the trend in ESG,” Pfeiffer says.

The Frankfurt-based company’s software makes it easy to measure the contribution of a company or a portfolio to climate change. Backed by the peer-reviewed XDC Economic Climate Impact Model, results are expressed tangibly and easy to interpret in °C. The software features scenario analysis and a variety of use cases ranging from portfolio and product design to climate reporting and risk management.

Pfeiffer says: “What I like about their data is that X degree Celsius figure, which means that, rather than talking about – rather abstract – tons of carbon emissions, I have a number on a scale. For example, a study across the 30 largest German companies reveals that by 2050, if they continue to behave the way they do, the impact on the planet will be a further 5.2 degree Celsius increase in average global temperatures.”

ESG remains on the top of the list of factors that clients want in their indices, Pfeiffer confirms. “As a theme, the momentum around ESG is really strong and only getting more so as it pops up in every client meeting.”

Solactive now has launched close to 14,000 indices. The data points provided by right. will allow Solactive to model any climate impact strategy that companies may have implemented.

“Me, as a simple index guy, can map and create indices on the back of that deeper data,” Pfeiffer says. “It expands our data availability in unique data points in ESG.”

Pfeiffer observes that there is a lot of hype and noise around ESG-based strategies and investment indices. “If I put this into perspective, the actual flows and investments into ESG are still marginal,” he says.

“One area that needs to develop is harmonisation and a common understanding of what ESG is – it’s not just a simple exclusion of sectors, which was ESG 1.0. We are lacking a common understanding of which companies score well or high and how to understand those with many different data providers doing their own scoring, so there is very little consistency.”

The recent InsideETFs conference in Florida saw a more muted attention to the ESG subject, Pfeiffer notes and has concerns that a lot of the attention the theme is getting is no more than ‘greenwashing’.

“There is actual momentum and understanding in Europe, which is much more serious,” he says.

Latest News

Saving and investing app, Moneybox, has doubled the number of ETFs available on the platform, in the light of ‘growing..
Global X ETFs has announced the appointment of Ryan O'Connor as its Chief Executive Officer effective as of April 8, 2024. ..
Value-driven structured credit investing firm, Angel Oak Capital Advisors, LLC, has announced the completed conversions of two of its mutual..
Confidence in the continuing strength of bitcoin and Ethereum is driving wider interest in altcoins and other digital assets, according..

Related Articles

Frank Koudelka, State Street Global Services
ETF data provider and ETF Express data partner, Trackinsight, has published its Global ETF Survey 2024 Report: ‘50+ Charts on...
Cryptocurrencies
Matteo Greco, Research Analyst at Fineqia International writes that bitcoin (BTC) ended the week at approximately USD52,150, showing a notable...
US Distribution Awards trophies
The winners of the first US ETF Distribution Awards at the Exchange conference, hosted by ETF Express and sponsored by...
Thomas Bonville, Clear Street
Just over a year ago, Thomas Bonville joined New York-based, prime brokerage Clear Street as managing director, head of derivative...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by