State Street provides ESG risk analytics as regulatory reporting requirements take hold

With the growth in interest around the Task Force on Climate-related Financial Disclosures and forthcoming European regulations, State Street enhances its ESG solutions.

By Jonathan Watkins

State Street has enhanced its ESG Solutions through a new risk analytics offering providing clients with the ability to address global regulatory reporting and risk disclosure requirements. 

Through a single platform, State Street said its data coverage will bring clients the ability to cover most Principle Adverse Impact (PAI) and disclosure requirements.

ESG Risk Analytics is designed to provide risk management, metrics and target reporting capabilities for Task Force on Climate-related Financial Disclosures (TCFD) on a platform that allows clients to measure their carbon footprint and intensity, and offers clients monthly, quarterly and annual ESG reporting.

In addition, State Street’s suite of ESG solutions will be providing regulatory support and complete data coverage for the EU Sustainable Finance Disclosure Requirements (SFDR) coming into force this week.

“ESG considerations are increasingly at the forefront of decision-making for investment managers and asset owners and there’s a growing demand for solutions that will provide the necessary data, risk analytics and reporting capabilities at scale,” said Rick Lacaille, senior investment advisor and global ESG lead at State Street.

“We continue to support TCFD recommendations and with our new ESG Risk Analytics tools, we are bringing our clients a holistic solution that helps assess ESG portfolios, while also enabling added transparency to meet the evolving global regulatory environment.”

The 2020 TCFD Status Report indicated the number of organisations expressing support for the TCFD has grown more than 85%, reaching over 1,500 organisations globally. Among these were financial institutions responsible for assets of $150 trillion.

State Street said the fully integrated offering through State Street Alpha – it’s front-to-back platform – will be available to clients later this year.

“Through our multi-vendor ESG analytics reporting, State Street clients have the ability to address the new regulatory package of the EU action plan on sustainable finance, requiring financial market participants to disclose extensively their ESG metrics, performance and policies, as well as to integrate ESG considerations in their risk management and investment decisions processes,” added Brenda Lyons, executive vice president and global head of product at State Street.