New Swedish Head Keen to Clear ESG Fog

    Stockholm (NordSIP) – With no end in sight to the demand for sustainable investment opportunities, asset managers are expanding their product offerings in this space, leading them to expand their team.

    Following continued growth in the Nordic region, Northern Trust Asset Management (NTAM),  a global investment manager responsible for US$1.2 trillion in assets under management, appointed Alexandra Kovalenko (Pictured) as head of its Swedish branch, with responsibility for leading sales across the Nordic region.

    “In my expanded role, I will be looking at how we continue to bring our investment capabilities to sophisticated Nordic investors. Most recently, Northern Trust Asset Management extended our ETF capabilities with the launch of four sustainable ETFs and we continue to launch funds that cater to our clients’ specific requirements.  I am excited to continue building new strategic business opportunities as well as strengthening existing key relationships,” Kovalenko tells NordSIP.

    Northern Trust Asset Management first established a presence in Sweden in 2009, following increased demand from Nordic-based clients for its range of investment management solutions. It has established relationships in the region for more than 25 years and continues to expand its capabilities and local footprint. According to the December 2020 IPE Survey of Nordic Institutional Assets, NTAM is the 4th largest manager of Nordic pension assets in the Nordic region and the 4th largest manager of global equities as well as the 8th largest manager of Nordic institutional assets.

    The Nordic Example

    “I have always been proud that the Nordic regions has been on the leading edge of ESG and sustainable initiatives. Particular to the region, we see a focus on demand for more customized ESG solutions and detailed discussions on impact and thematic investing,” Kovalenko adds.

    “Nordic investors have been a key driver behind implementing carbon and fossil reduction in their portfolios. For instance, the Swedish environmental objective of achieving net-zero greenhouse gas emissions by 2045 is more ambitious than the targets according to the Paris Alignment,” Kovalenko says.

    “Nordic investors demand managers to look beyond the focus of carbon reduction and to take an increasing interest into the ‘S’ and ‘G’ of Responsible investing. They also pay close attention to global norms and Sustainable Development Goals,” Kovalenko continues.

    Kovalenko joined Northern Trust Asset Management in 2019, from sales roles in Northern Trust’s Corporate & Institutional Services (C&IS) sales team which she joined in 2017.  Prior to joining Northern Trust, she worked as an Equity Sales Trader with Goldman Sachs in London across multiple execution desks. Kovalenko holds a bachelor’s degree in Economics from UCL – University College London, UK.

    “At Northern Trust Asset Management, we believe investors should be compensated for the risks they take – in all market environments and any investment strategy,” said Marie Dzanis, head of NTAM for Europe, Middle East and Africa (EMEA). “We’re seeing continued demand from investors across the Nordic region for sustainable investing solutions, particularly within our Environmental, Social and Governance (ESG) quantitative active strategies and ETF funds. Through Alexandra’s leadership, expertise and local experience, we will be well placed to support our Nordic clients in achieving their investment goals,” Dzanis continues.

    Challenges and Solutions

    Discussing the challenges facing sustainable investors, Kovalenko emphasised how crowded with alternative data providers the market is. This increased competition leads to increased demands for transparency and insights to differentiate solution providers.

    “At Northern Trust Asset Management, we continually work to enhance our custom ESG process, working collaboratively with our clients. As demand for ESG-driven investing has accelerated, so too has the number of data providers – each with varying information, reporting components and levels of transparency. This has created confusion and subjectivity for investors to assess the magnitude and direction of individual companies’ ESG-related issues,” Kovalenko explains.

    “Investors have expressed the need for a more transparent and disciplined framework that focuses only on the ESG-related business issues that could impact the financial condition of a company ­– and ultimately their portfolio’s investment return. Our ESG Vector Score leverages the practical insights we’ve gained over the past 30 years helping some of the most sophisticated and progressive global investors integrate ESG criteria into their investment portfolios,” Kovalenko adds.

    “Our mission at Northern Trust Asset Management is to enable global investors to achieve their most important goals by providing insights, solutions and an exceptional client experience. I am personally very proud of some of the work we have done to launch our ETFs in region and serve investors who may be concerned about reducing carbon in their portfolio while seeking income or looking to manage volatility,” Dzanis says.

    “Additionally, we continue to work closely with our clients in the Nordics when launching and developing our strategies with the most recent work around our developments within our Green Transition Strategy in Emerging Markets. This was done in partnership with a key Nordic client and our strategic direction of developing more products that focus on fossil fuel free and tilt towards companies which are capitalising on the transition to a low carbon economy. We consulted and collaborated through the process to ensure we devised a solution that best met their objectives,” Kovalenko concludes.

    Image courtesy of Northern Trust Asset Management
    Filipe Albuquerque
    Filipe Albuquerque
    Filipe is an economist with 8 years of experience in macroeconomic and financial analysis for the Economist Intelligence Unit, the UN World Institute for Development Economic Research, the Stockholm School of Economics and the School of Oriental and African Studies. Filipe holds a MSc in European Political Economy from the LSE and a MSc in Economics from the University of London, where he currently is a PhD candidate.

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