Stockholm (NordSIP) – Solactive announced the launch of the Solactive ARC ESG Big Data Europe Index, developed with ARC Responsible Investment earlier in 2019 based on OWL Analytics data. The index tracks the performance of European stocks with a high consensus ESG score, based on data provided by OWL Analytics.
“The index allows investors to benefit from an innovative and smart ESG approach while reducing the overall risk of the portfolio, achieved thanks to various risk factors,” commented Xavier Ducros, Founding Partner at ARC Responsible Investment
OWL Analytics is a data provider that aggregates hundreds of sources of ESG data and research to create company scores and rankings based on a reliable and objective foundation. After the initial selection from OWL Analytics, Solactive applies financial screenings such as liquidity, dividend-yield, and risk filters to build the final index composition.
“This project exemplifies Solactive’s flexibility in tailoring indices to meet clients’ needs,” explains Timo Pfeiffer, Head of Research at Solactive. “We are incorporating cutting-edge ESG metrics derived from a big data approach, thereby excluding non-compliant activities and sectors as well as polluting companies, which allows our clients to access the latest innovations in ESG.”
The index strategy seeks to achieve lower volatility and lower drawdowns compared to its benchmark, the Solactive GBS Developed Markets Large & Mid Cap Index. Presumably, one of the main advantages of aggregating several sources of ESG data is that it may provide the means to overcome some of the inconsistencies that plague ESG ratings.
“We are delighted to be part of this new generation ESG index by integrating our proprietary technology ESG strategy that reduces subjectivity in ESG scoring providing the best-of-the-best ESG consensus,” said Benjamin Webster, CEO at OWL Analytics.