Northern Trust Investment Risk & Analytical Services: ESG Insights
Originally published in Northern Trust's 2022 Sustainability Report
Northern Trust offers a suite of post-trade analytics services providing investors with insight and oversight of key ESG and climate-risk exposure detail.
ESG Ratings Summary:
This reporting service, which launched in 2020, offers a quantitative method for measuring ESG factors. Using a bottom-up, holdings-level approach, it provides clients with a top-down summary view of ESG risk exposures over time, with drill-down analytics available within each pillar.
Climate Focus:
We introduced a focused reporting option to help clients monitor and disclose climate risk exposures aligned to the Task Force on Climate-Related Financial Disclosures (TCFD) framework. This service includes portfolio-level detail on a range of physical risk and transition risk indicators, such as carbon emissions data and scenario pathway analysis.
Performance Measurement:
Clients are able to evaluate the relative performance impact of ESG factors on their portfolios, programs and policy statements. We support a range of ESG-focused benchmarks that allow for relative comparisons of securities down to the most granular level. We have also integrated ESG scores into our reporting platforms to help clients gauge the impact of ESG performance versus financial performance.
Multiple product initiatives are inflight to integrate additional ESG and climate data into our analytics and reporting platforms, and to expand data coverage for a multi-asset class investor beyond public assets.
