Refinitiv has launched MarketPsych ESG Analytics, a new analytics tool to provide numerical ESG insights on companies and countries based on news and social media monitoring.
To monitor perceptions of sustainability and ESG risk, Refinitiv and MarketPsych have partnered to create a multidimensional ESG analytics offering. Refinitiv MarketPsych ESG Analytics complements its existing ESG data by offering an external “outside-in” perspective on a company or country’s sustainability by processing millions of global articles and social media posts in near real-time.
Refinitiv MarketPsych ESG Analytics can be used in a host of applications. Quantitative investors can deploy the data to enhance alpha generation and risk management. Discretionary investors can use the data to improve portfolio construction. Corporate clients can monitor market perceptions of their own and competitor firms. Regulators can use the data to more precisely direct investigations. Analysts and researchers can explore relationships between ESG and economic performance. Governments are able to monitor media perceptions of their activities.
Leon Saunders Calvert, Head of Research & Portfolio Management, Refinitiv, says: “Refinitiv MarketPsych ESG Analytics augments Refinitiv’s ESG company disclosed data with sophisticated AI tools to create high frequency sentiment data on ESG considerations based on news and social media. This is a fantastic and timely extension of our long-standing partnership with MarketPsych and we look forward to bringing this to market to add yet more value to our sustainable finance portfolio of services.”
Gathering and analysing articles about environmental impacts, sustainability and government stewardship requires specialised capabilities. The software underlying the Refinitiv MarketPsych ESG Analytics is a complex AI-based natural language processing (NLP) engine, which locates, filters and scores environmental, social and governance (ESG)-themed content pertaining to specific companies as well as cities, regions and countries from tens of millions of authors in thousands of global resources – over two million credible articles and posts every day in a dozen languages. The NLP engine excludes corporate press releases, corporate websites and regulatory filings in order to maintain the outsider perspective of third-party media and minimise the impact of corporate “greenwashing.”
In this ESG data feed, scores on over 100 ESG themes and controversies are published in minutely, hourly, and daily updates. The data covers 30,000+ companies and 252 countries and territories. The data history extends back to 1998, and companies were added point-in-time to facilitate quantitative research and minimise survivorship bias. Scores are published on key ESG themes such as intellectual property violations, management scandals and ESG policy failures.
Richard Peterson, CEO, MarketPsych, says: “Through the lens of this data, our clients can explore how media perceptions and corporate behaviour impact business performance over time. For example, we’ve found that the share prices of companies with higher Workplace Sentiment scores significantly outperform their peers, and it appears that happier employees generate more value for shareholders. We hope that such insights inspire positive changes in corporate structure and behaviour.”