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Behind the Padlock: Understanding Data Security in ESG

Organizations are now collecting and storing large amounts of non-financial data for ESG. In this blog post we discuss why data security is important in the context of non-financial ESG data, the methods available to do so, and the steps we take as an organization to protect client data.

Why is data security important?

Data breaches are an unfortunate byproduct of the highly connected and digital world we live in, placing a responsibility on organizations to ensure sufficient data protection measures are in place. With the rise of ESG, organizations now have to collect large amounts of non-financial data, in addition to the financial data already being collected and stored. Whether for sustainability reporting requirements or to inform strategic decision-making, protecting this data is vital before it’s publicly released.

As the volume of non-financial ESG data being collected by organizations continues to increase, ensuring that the data is being handled securely and ethically is an important governance consideration which, if done well, can contribute to greater resilience and long-term, sustainable business growth.

By investing in robust data security measures, organizations can avoid the financial costs of damages associated with data breaches, reduce the overall risk of financial and non-financial data being lost or stolen, and reduce the risk of reputational damage.

How can data be protected?

As technology has developed, the ability to contain data breaches has also improved, and there are now a myriad of ways that organizations can protect their data. To create and implement an effective data security policy, consideration must be given to the type and volume of data being stored, where vulnerabilities exist, and how best they can be mitigated. 

Approaches to data security include creating security layers to increase the chances of identifying and halting potential attacks, introducing role-based access to control what access rights certain individuals are entitled to, and asking users for multiple pieces of evidence to verify their identities, known as multi-factor authentication (MFA). 

Keeping data security measures updated in line with industry standards is also a useful way to ensure the protections put in place are robust enough. There are several ISO and industry standards relating to data security and privacy, including GDPR, ISO 27001 and SOC2. 

How we protect client data

At Rimm, we believe that data security is an important part of ESG, whether it is the ethical handling of data or compliance, the non-financial data that organizations gather should be secured and protected, just like financial data. We take data security seriously and know it is important to clients, which is why our platform is hosted on an enterprise-class high performance cloud infrastructure with multiple layers of security. Our platform is also hosted within Amazon Web Services data centers, which are secure and certified.  

Our security system is governed by a comprehensive set of Policies & Procedures, including Access Control, Data Classification, Encryption, Information Security and Physical Security. Below are some of the key approaches used to ensure we protect our clients’ data: 

Interested to learn more about our solutions? Book a session to talk with our team today. 

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Exploring ESG Modularity: A Path to Sustainable Investing

In this blog post, we explore how ESG modularity has become a key element in aiding sustainable investment decisions at a time when investors are demanding transparency around ESG. Find out how your company can get started on easier compliance methods with minimal disruption to your existing workflows.

Understanding ESG Modularity

The concept of ESG modularity refers to the ability to break down the broad spectrum of ESG considerations into modular components or individual factors. As opposed to treating ESG as a monolithic framework, modularity allows investors to evaluate and prioritize specific elements. ESG issues can vary significantly across industries, regions, and companies, so a one-size-fits-all approach may not be appropriate.

The Importance of Flexibility

Flexibility is one of the key benefits of ESG modularity. When investors break down ESG criteria into modular components, they can tailor their approach to align with their unique preferences, risk tolerances, and investment objectives. Investors can take advantage of this flexibility to concentrate on the ESG factors that matter most to them, such as reducing carbon emissions, enhancing gender diversity, or strengthening community engagement.

Enhancing Decision-Making

By providing investors with a granular understanding of risk and opportunity associated with their investments, ESG modularity can also enhance decision-making. A more nuanced analysis of ESG factors can be conducted rather than relying on broad ESG scores or ratings. A deeper level of insight can lead to better risk management and more informed decisions.

Integration Across Asset Classes

ESG modularity also facilitates the integration of ESG considerations across asset classes. Investors can apply modular ESG frameworks to evaluate the sustainability performance of their entire portfolios, regardless of whether they invest in equities, fixed income, real estate, or alternative assets. Regardless of asset class, this holistic approach ensures that ESG considerations are seamlessly integrated into the investment process.

Bespoke myCSO from Rimm Sustainability

Rimm’s Bespoke myCSO is a modular ESG solution that allows clients to customize their sustainability solutions to match their specific needs. With Rimm’s varied building blocks like assessments, impact reports, carbon calculators, etc. The client can create their own plug-in-play modular solution.

Regulatory and compliance mandates imposed by governments can be met with this solution by large enterprises. Using Bespoke myCSO, clients can save time and meet all regulatory and compliance requirements easily.

Insights into the Future of Sustainable Investing

Sustainability investing continues to gain momentum, and ESG modularity is poised to play an important role in shaping its future. With bespoke myCSO, investors can benefit from greater flexibility, insight, and integration capabilities, while also achieving competitive financial returns. Investors, asset managers, and other stakeholders can use bespoke myCSO to drive long-term value and advance sustainability.

Simplify Your Sustainability Performance & Tracking With myCSO

✅ Calculate your scope 1, 2 and 3 emissions instantly

✅ Gauge your company’s sustainability performance

✅ View your sustainability performance all from one dashboard

Benchmark against industry peers

Enter your information below to book a demo with our team today.

Cultivating Employee Wellbeing: A Cornerstone of Sustainable Success

Sustainability encompasses more than environmental concerns in today’s fast-paced and competitive business environment. A company’s long-term sustainability depends on the wellbeing of its employees. In this blog, Aayush Gupta, our Customer Marketing and PR lead, explores how employees’ wellness is connected to sustainability in the workplace.

Understanding the connection

  1. The Human Element of Sustainability: Often, sustainability is linked to environmental stewardship. In reality, it is about meeting the needs of the present without compromising the ability of future generations to meet their own. In order for sustainable development to work, humans have to be at the center. It’s all about employee wellbeing since engaged, healthy employees drive innovation, productivity, and long-term success.
  1. The Wellbeing Imperative: The hyper-connected world of today poses a variety of challenges to employees. Stress at work, burnout, sedentary lifestyles, and mental health problems are all part of the modern workplace. To foster a culture of well-being that supports employees, it’s important to recognize and address these challenges.

 

In a nutshell

The well-being of employees isn’t just a feel-good initiative; it’s also a strategic imperative that impacts productivity and sustainability. Companies can foster engagement, productivity, and innovation by prioritizing employees’ health and happiness. In addition to benefiting individuals, investing in employee well-being helps the organization stay successful for a long time. Our most valuable asset is our people, so let’s keep that in mind as we navigate the modern workplace. A successful business depends on its wellbeing.

 

Simplify Your Sustainability Performance & Tracking With myCSO

✅ Calculate your scope 1, 2 and 3 emissions instantly

✅ Gauge your company’s sustainability performance

✅ View your sustainability performance all from one dashboard

Benchmark against industry peers

Enter your information below to book a demo with our team today.

Bringing ESG and Sustainability into Fintech: Harmony in Finance

The intersection of finance and sustainability has gained significant momentum in recent years, reshaping the financial landscape. Our blog explores the profound impact of ESG and sustainability on the fintech industry, how it’s driving innovation, fostering change, and reshaping the future.

Environmental, Social, and Governance (ESG) in Finance:

Investors, consumers, and businesses evaluate a company’s environmental, social, and governance practices by looking at ESG criteria. Adopting ESG principles in fintech means aligning financial services with ethical and sustainable practices. Here’s how each component works:

  1. Environmental (E): Fintech is starting to recognize its impact on the environment, from energy consumption to waste generated. Green fintech like paperless transactions, carbon-neutral operations, and renewable energy adoption can help make the world a better place.
  2. Social (S): Any industry needs social responsibility to succeed, and fintech is no exception. By leveraging technology, fintech companies are promoting financial inclusion, offering affordable services to underserved communities, and facilitating responsible lending. Socially responsible fintech solutions bridge the financial gap and empower individuals and businesses alike.
  3. Governance (G): Transparent corporate governance, ethical decision-making, and diversity and inclusion are top priorities for fintech companies. To build trust among stakeholders, fintech firms need to adhere to robust governance practices.

Innovation in ESG and Fintech:

  1. Responsible Investing: Fintech platforms facilitate responsible investing by integrating ESG metrics into investment decision-making processes. As a result, investors can align their portfolios with their values, promoting sustainable and ethical investing.
  2. Blockchain for Transparency: Blockchain technology in fintech enhances transparency and accountability. In alignment with ESG governance principles, blockchain ensures data accuracy, reduces fraud, and fosters user trust by providing a transparent ledger.
  3. Green Financing: Fintech companies are at the forefront of green financing options. With innovative solutions like peer-to-peer lending for sustainable projects, fintech makes the economy more sustainable.

Challenges and Opportunities

Keeping ESG sustainable in fintech is challenging but also has many opportunities. Financial industry stakeholders are demanding more transparency and responsible business practices, so ESG considerations are becoming more important. These are some challenges and opportunities for fintech ESG sustainability:

 

 

What does Rimm do to solve this problem?

The exclusive offering by Rimm to financial institutions allows seamless traction, reducing the time, costs, and resources that asset and fund managers spend on managing and reporting ESG data. With Rimm’s solutions, you can have a bird’s eye view of your portfolio’s sustainability performance, boost communication with your portfolio companies, and generate aggregated metrics instantly. In addition, Rimm provides bespoke myCSO, which emphasizes modularity, and plug-in-play options that allow Fintech companies to customize their solutions using Rimm’s various AI-powered building blocks. It allows an organization to easily keep track of regulatory compliance and to stay ahead of changing ESG regulations.

The ESG sustainability revolution is changing how businesses operate. With its agility and technological prowess, fintech can lead this transformation. Embracing ESG principles can create value for stakeholders, the planet, and society. Sustainability and finance go together; they contribute to a more resilient, inclusive, and sustainable economy.

Simplify Your Sustainability Performance & Tracking With myCSO

✅ Calculate your scope 1, 2 and 3 emissions instantly

✅ Gauge your company’s sustainability performance

✅ View your sustainability performance all from one dashboard

Benchmark against industry peers

Enter your information below to book a demo with our team today.

Understanding both business and ESG Risk for Decision-making

Risk Rating: Understanding Both Business and ESG Risk for Decision-Making

Do you have a clear understanding of the overall risk profile of your organization, and that of your clients? Read on to find out why a comprehensive understanding of risk is essential for businesses.

The extent to which companies are exposed to certain risks impacts strategic and operational decision-making, so getting an accurate representation of your company or client’s risk profile is pivotal to ensure decisions are effective and informed. In addition to decision-making, there are several other reasons why organizations should prioritize understanding their risk profile: 

Prioritization: having a clear understanding of the risks posed to an organization can guide resource allocation and help ensure continual growth. By seeing what risks are most material and pose the biggest threat, organizations can ensure sufficient resources are used to mitigate and manage them. 

Improving Risk Profile: As the saying goes, you can’t manage what you can’t measure! Being able to see and monitor risk means organizations can set and track targets to improve their risk profile, or help customers manage theirs. In doing so, organizations not only improve their credibility in the short term, but also future-proof themselves in the long term. 

Expanding KYC Checks: Risk rating can support Know Your Customer (KYC) checks, providing data on ESG and Business risks that may impact if or how customers are engaged. This is particularly useful for professional service firms supporting clients with KYC checks, and even for financial service providers who are mandated to complete KYC checks by regulators. 

How can organizations better understand their risks?

Organizations that do not seek to understand their risk profile can become overly exposed to material risks that impact their revenue and profitability, and be ill-prepared to mitigate against these risks in the present and future. There is also a risk of falling behind competitors by failing to take the necessary steps to manage risks. 

It’s good to know the importance of measuring risk and the dangers of not doing so, but how do you understand it? Considering local context is key: ESG is a function of the local cultural, social, political and regulatory environment and varies greatly between countries and regions. As such, it is important that ESG rating models are localized and contextualized. In addition, organizations can get a better understanding of their risk profile (or clients) by looking at both business and ESG risk together. By considering a comprehensive list of risk categories from natural resource scarcity to regulatory risk, a holistic understanding can be gleaned. 

How our Risk Rating Solution Works

Our Risk Rating Solution considers 12 different ESG Risk categories that cover material ESG KPIs by industry, intertwined with 6 Business Risks to map out ESG impacts on the business. Using publicly available sources, estimations, or direct company assessments, the tool can provide risk rating scores (showing methodologies and inputs), comprehensive analytics reports and a monitoring service. These outputs can be integrated into existing business platforms through APIs.

To ensure an understanding in context, our analysis and insights consider industry-specific leading material factors and compare performance to peers. 

 

Our comprehensive database has over 20,000+ companies and is constantly updated with the latest available information, looking at company-disclosed KPIs and comprehensive risk metrics. 

Using a custom, state-of-the-art machine learning model we can also offer risk estimations, predicting risk intervals with 95% accuracy. This model has been trained from scratch using risk data, and can support clients to gain a better understanding of their risk profile. 

Interested to learn more about our Risk Rating Solution? Book a session to talk with our team today. 

Roata Stefan-Cristian
Junior Data Scientist

Having graduated from Yale-NUS with a Lee Kuan Yew Gold Medal, only offered to the best-performing students in the cohort, Stefan is a well-versed individual familiar with the workings of data science and analytics and has contributed greatly to the creation of our data solutions at Rimm. 

Simplify Your Sustainability Performance & Tracking With myCSO

✅ Calculate your scope 1, 2 and 3 emissions instantly

✅ Gauge your company’s sustainability performance

✅ View your sustainability performance all from one dashboard

Benchmark against industry peers

Enter your information below to book a demo with our team today.

The Synergy of AI and Data in ESG: A Transformative Force for Sustainability

ESG factors are beginning to play a vital role in corporate decisions and strategies. This is where AI and Data Analytics can make this information even more accessible and actionable. Find out how below!

1. Data-Driven ESG Metrics

The collection and analysis of relevant data is a fundamental component of ESG integration. A large and complex dataset, such as that required by ESG initiatives, is often beyond the capacity of traditional methods. In contrast, AI algorithms are highly adept at processing large volumes of structured and unstructured data, enabling organizations to gain meaningful insights and metrics from their data.

Companies can gain a comprehensive understanding of their environmental impact, social initiatives, and governance structures by using machine learning models to identify correlations and trends. As a result of this data-driven approach, ESG strategies remain flexible and responsive to changing challenges while improving accuracy and enabling real-time monitoring and reporting.

2. Predictive Analytics for Sustainable Practices

A predictive analytics approach to AI can provide organizations with early warning of potential ESG risks and assist them in addressing them before they escalate. An algorithm that analyzes historical data can, for example, detect patterns that may indicate future environmental or social challenges. By proactively implementing sustainable practices, companies mitigate risks and enhance long-term resilience.

In addition, predictive analytics can identify areas in which sustainability efforts can be most effective and assist in optimizing resource allocation. This is why ESG initiatives should be aligned with overarching business objectives, leading to a win-win situation for the company’s sustainability as well as its financial performance.

3. Enhanced ESG Reporting and Transparency

It is crucial to foster trust among stakeholders and investors by providing transparent and accurate reporting. By automating data collection, validation, and reporting, the margin for error is reduced and the reporting cycle becomes more streamlined.

With blockchain technology, which is often integrated with AI, ESG reports are made even more credible because they provide an immutable and transparent ledger of transactions. By doing this, companies can ensure the integrity of their reported data and prevent greenwashing.

4. AI-Powered ESG Investment Strategies

ESG factors have become increasingly important to investors in their decision-making processes, and are seen as a potential source of long-term value creation and risk mitigation. Investors can identify ESG-friendly investments using AI-driven tools that analyze vast datasets. ESG performance can be evaluated using machine learning algorithms, as well as risk factors and trends relating to sustainability. Investing in responsible companies allows investors to make informed decisions aligned with their values.

 

How can Rimm help with your AI needs for sustainability?

As a pioneer in AI development, Rimm Sustainability has integrated AI into ‘myCSO’, an ESG platform designed to provide customers with a better ESG experience and simplify a complex reporting process to satisfy legislative requirements. Our AI-driven solutions empower organizations to not only meet current ESG standards, but also proactively shape a more sustainable future. The metrics and predictive analytics we provide, along with enhanced reporting and tailored investment strategies, are driven by data.

Rimm’s enhanced AI tools, such as Transition Risk, Risk Approximation and Risk Rating, provide enterprises with a 95% accurate picture of their risk exposure and profile. In this way, the executives can make critical decisions to continue driving the company’s growth. The synergy between AI and data will become a driving force for promoting environmental management, social responsibility, and ethical governance as we continue to harness technology. 

Browse our solutions catalog or book a free demo today!

Simplify Your Sustainability Performance & Tracking With myCSO

✅ Calculate your scope 1, 2 and 3 emissions instantly

✅ Gauge your company’s sustainability performance

✅ View your sustainability performance all from one dashboard

Benchmark against industry peers

Enter your information below to book a demo with our team today.

Driving Holistic Investment with Outcome-based Investing

Driving Holistic Investment: Sustainability Emphasis in Outcome-based Investing

In the intricate world of investments, a new paradigm is emerging. The canvas for Outcome-Based Investing (OBI) is expanding, traversing domains from mining and rare materials to oceans, gender equality, security, and beyond. These outcome vehicles represent a limitless array of possibilities, empowering investments to catalyze holistic change. Read more below!

The Essence of Outcomes vs. Impact

Outcome-based investing is a transformative approach that distinguishes between short-term, quantifiable outcomes and broader, long-term impacts. While outcomes signify specific, measurable changes that reflect a finite alteration, impacts delve deeper, envisioning the comprehensive effects of initiatives, encapsulating the transformation on a broader societal scale.

Placing Goals at the Center

At the core of OBI lies the strategic alignment of investment portfolios with personalized objectives. It’s a shift away from conventional benchmarks toward constructing portfolios tailored to individual goals. Flexibility, adaptability, and diversification are pivotal in maximizing the likelihood of achieving unique investment aspirations.

The Dawn of 2030: Emerging Markets and ESG Evolution

The future of ESG and Outcome investments appears poised for a significant shift, predominantly within the small and mid-cap space and outside developed markets. Emerging markets hold immense potential, presenting both challenges and unprecedented opportunities. Emerging markets present the biggest gap in funding a transition (an estimated USD2.5 trillion a year, compared to 0.1 trillion in advanced economies) but also some of the biggest opportunities. These regions often grapple with acute climate change impacts like floods, droughts, and crop failures. Directing institutional capital into these markets can bolster their financial systems, fostering growth and maturity.

The True Essence of Real ESG and Outcome Investing

Real ESG and Outcome Investing extend beyond conventional metrics and financial returns. It’s about investing in companies and markets that promise multidimensional returns—positive societal and environmental impacts alongside financial gains. Whether these investments outperform hinges on diverse factors, including the expertise of investment managers, regulatory developments, and evolving consumer preferences.  Yet, it signifies a step towards shaping a more sustainable and equitable future.

 How can Rimm help investors?

Rimm Sustainability’s bespoke solutions such as myCSO for fund managers, True Materiality and Transition risk 360 provides investors with accurate data curated by AI technology to help investors track and manage their portfolio’s ESG performance and make an informed investment decision based on industry metrics. Rimm can provide end-to-end AI solutions for ESG management and support a wide range of use cases and business objectives at various stages of ESG maturity.

Browse our solutions catalog or book a free demo today!

 

Sasja Beslik
Senior Advisor, Data Analytics

With 20 years of experience in advising multinational companies, Sasja Beslik is an expert in data analytics and creating strategies for integrating ESG into asset management. He also currently sits on Rimm’s esteemed advisory board.

Simplify Your Sustainability Performance & Tracking With myCSO

✅ Calculate your scope 1, 2 and 3 emissions instantly

✅ Gauge your company’s sustainability performance

✅ View your sustainability performance all from one dashboard

Benchmark against industry peers

Enter your information below to book a demo with our team today.