Insights

Quantitative Research

We support clients in implementing and maintaining unique quantitative ESG scores to support the integration of material ESG impacts in corporate analysis and portfolio management.

The WaVeritas corporate and sovereign ESG rating serves as benchmark and systematic element in addition to the unique scoring mechanism. An ESG rating can add value as it allows for a systematic comparison of selected, material ESG criteria among companies within the same industry. Our ESG rating is crafted for portfolio considerations in particular including several unique factors including product impact, quantitative focus and disclosure elements. The rating dates back to 2013 focusing on pure quantitative assessments in over 50 industries and 11’000 companies. Please refer to our methodology for more information.

While an ESG rating has inherent limitations, the evidence regarding the correlation between ESG and financial performance on corporate or portfolio level has extended massively. Meanwhile, based on this growing evidence body, the value of ESG consideration is widely accepted and endorsed.

Qualitative (descriptive) research for value strategies

We believe that ESG integration should consider the unique investment strategy, philosophy and objective in order to be most effective. While the corporate ESG analysis and valuation is at the heart of our engagement with value strategies, the ESG integration process consists of several activities.

The actual activities performed, depend on the mandate structure. The following picture provides a simplified overview of what components could be included in the process:

The shown activities, ESG research, quantification and valuation, active ownership engagement and ongoing monitoring and compliance are considered the fundamental actions we undertake for our clients. The information exchange between the portfolio manager, the analysts and us takes place at several points during the process. For example, a summary report outlines the material risks and growth indicators of a potential investee company. The report is an integral part of the investment process. Please see below a generic, anonymized sample report.

The following overview provides valuable insights into more possible activities within the ESG integration framework:

Communication & reporting

ESG regulations and accounting initiatives paving the way towards more streamlined reporting. Given the broad nature of sustainability and the challenges around measurement, quantification and simplification, this process will evolve further over time. Informing stakeholders about ESG practices and performances is an important topic for many companies across all sectors amid stronger expectations from society, investors and regulators.

WaVeritas supports clients in communicating ESG and impact metrics in a coherent and tangible way, in line with the mandates unique strategy. For us, adequate reporting is based on the following principles:

  • As quantitative as possible
  • Methodological and transparent
  • Aligned with benchmark and standards
  • Relevant for the particular investment strategy
  • Based on traceable data of the highest possible quality

There are two ways we can support our clients

  • Data and information delivery for clients own report
  • Example Client Report

  • The standardized WaVeritas report
  • Example Standardized report

Alternative Investments

As an active partner for alternative investment managers, WaVeritas accompany the ESG management during the entire investment process.

Impact Opportunities

Please find below the link to our partner page, where project and business owners, funds and investors can exchange and showcase their impact ideas
and solutions.