Environmental Science recently interviewed Patricia Torres, Bloomberg's Global Head of Sustainable Finance Solutions, and Brad Foster, Bloomberg's Global Head of Enterprise Data Content, about the integration challenges that financial institutions face on ESG.
Environmental Finance: Investment managers are facing a growing regulatory burden, with the need to comply with the SFDR, the EU Taxonomy regulation, etc. How can they best address the data challenges involved?
Patricia Torres: Investment managers need to have strong data, analytics and integration, and they need to be very clear about their sustainability goals. Are they looking to address ESG risk, or pursue impact? Can they demonstrate alignment with these goals? To do that they need to do their homework, understand the data they are ingesting, and ensure it is fit for purpose.
Investment managers also need to be on top of evolving global regulatory requirements and recognise that each one will require specific datasets and information so they can comply and market their funds appropriately. It’s something we’re very focused on at Bloomberg, structuring datasets to allow compliance with ESG regulations as they evolve, like the EU Taxonomy requirements, for example.
We also ensure we can provide estimates to fill gaps when there is not sufficient company reported data, whether it’s carbon emissions data or EU Taxonomy eligibility data. For example, of the 4,360 companies we’ve reviewed, only 315 have reported their EU Taxonomy eligibility data as of June 2022. It is important for investors that their data vendor can address gaps such as these.