Finding new high-potential sustainable investment cases
SAS helps with data driven tool to track current investments sustainability profile
Impact
on daily work with new flow of live data
Carve achieved this using • SAS® Viya® • SAS® Visual Analytics • SAS® Visual Text Analytics • Microsoft Azure • Python
Nykredit Invest needed data driven tools to track their current investments’ sustainability profile and find new ones that focus on a sustainable future.
The past few years have seen a growing interest in sustainable investments. But how do investors find high-potential projects and companies – who may not even have realized their great potential to contribute to a better future?
For the SAS® 2020 Hackathon the team from Carve partnered with investment company Nykredit Invest to identify which of their current and potential investment companies are focusing on climate action and sustainability as expressed in the UN’s Sustainable Development Goals (SDGs).
Nykredit invests in 4,920 companies through 500 active company portfolios and is a market leader in the sustainable investment arena. It was the first investment company to earn the Nordic Swan Label for sustainability, and has a formal partnership with UN PRI, the UN principles for responsible investments.
Nykredit is not only interested in whether an investment is compliant with the SDG’s. They are also interested in identifying companies with a SDG strategy where there is a great potential for change. Nykredit wants to have a constructive dialogue with the company they invest in about the changes that are required in order for Nykredit to continue or expand their investment to ‘boost’ the outcome of their investment.
Nykredit Invest relies on manual auditing of sustainability reports from investment companies in order to monitor that UN SDG standards are being met. It takes a lot of time and resources to sift through information about potential investment cases to find ones that fits Nykredit’s requirements in terms of focus on the climate and sustainability.
Automating collection and extraction of data
For the SAS® Viya® Hackathon, Carve developed an automation platform which combines Robot Process Automation (RPA), so-called elastic search, text mining, and machine learning, to create numeric score for each investment case.
“In collaboration with the investment professionals at Nykredit, our team took on the challenge of speeding up the due diligence task of investment screening and monitoring, by building a screening instrument based on the use of unstructured data, advanced analytics and intelligent triage processes,” says Mads Krogh Munch Nielsen, partner at Carve, who headed up the team.
The output information is transformed into charts that are readily available for the portfolio managers on the SAS® dashboard. It shows when there is new relevant activity within their current investment companies and also allows portfolio managers to search for potential new investments. Based on industry and sustainability goals, the portfolio manager can select a company and see an overview of their annual sector score report, general company information, which sustainability goals they meet, current news about the company, and their stock market price.
“This solution from Carve will have a very important impact on our daily work because it gives us a new flow of live data, compared to only getting reports on an annual or semiannual basis as well as access to information on sustainability aspects of companies that we did not have before,” says Kasper Jacobsen, Chief Portfolio Manager at Nykredit Invest.
“We have the primary data from MSCI ESG research to make sure we cover all of the universe, and then we add other layers to that, especially because our data needs are actually not met anywhere today. All portfolios are screened once a quarter and additional lists are uploaded to our portfolio management system to make sure we always act on the data we actually have and with investments in 4,920 companies we do have a lot to cover,” says Søren Larsen, Head of ESG at Nykredit Invest.
We have the primary data from MSCI ESG research to make sure we cover all of the universe, and then we add other layers to that, especially because our data needs are actually not met anywhere today. All portfolios are screened once a quarter and additional lists are uploaded to our portfolio management system to make sure we always act on the data we actually have and with investments in 4,920 companies we do have a lot to coverSøren Larsen Head of ESG Nykredit Invest
4,920
Investments in 4,920 companies
500
Active company portfolios
2020
Participant in the 2020 SAS® Hackathon
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