Solutions were built with a quick turnaround after the SFDR draft regulation was published in Spring 2021 and were launched Summer 2021. Danske Bank Asset Management, was the first client to adopt the solution and go live.
The partnership with Danske Bank Asset Management together with the input of the broader SimCorp client community, enabled standard SFDR and EU taxonomy solutions with future-proof infrastructure.
The high demand from clients for these offers, following the launch, confirmed the market appetite for integrated ESG processes in the SimCorp Dimension investment platform DNA: the single-platform architecture enables easy-access, consistent, real-time usage of ESG analytics across portfolio management, trade control, compliance checks, monitoring of ESG exposures and performance metrics, as well as reporting and communications to stakeholders.
Christian Kromann, CEO of SimCorp said: "Enabling ESG and Sustainable investing for our clients is a core aim of our wider sustainability strategy, and close client partnerships remain a formidable way to support our clients' long-term strategic ambitions."
Carl Balslev Clausen, ESG Offer Manager, at SimCorp said: "In the past few years, ESG investing has evolved from simple screening and exclusion principles to more sophisticated approaches that include all asset classes, across public and private markets. Operations platforms need to facilitate the larger scale and the additional complexity in both data and analytics that is required for investment managers to achieve their sustainability-related targets, and to future proof the infrastructure to cater for the fast evolving ESG market and regulation. At the same time it is essential to maintain unbreakable consistency and integrity in areas such as trade controls, which is key to maintain trust and legitimacy within ESG Investing. These are the reasons we have evolved our single-platform approach to include ESG analytics.
Christian Heiberg, CEO of Danske Bank Asset Management, said: "The sustainable agenda is rapidly picking up speed and we are fully focused on constantly improving our sustainability efforts to stay ahead of the curve and be one of the best Nordics banks for responsible investments. This requires a strong infrastructure and that we continuously work to develop our investment operations platform. Our partnership and collaborative co-creation approach with SimCorp ensure we have relevant tools and systems to consistently integrate sustainability-related perspectives in our investment management processes and products."
About SimCorp's new ESG framework
Sustainable investing and ESG integration are becoming ever more sophisticated and require new capabilities in investment operations. SimCorp has therefore introduced a new, dedicated framework that enables these capabilities through its Dimension product.
It is an open-ended, flexible framework that caters for a wide set of ESG strategies and will continue to evolve to keep up with the latest market thinking.
The new framework, co-created with Danske Bank Asset Management, allows asset managers to:
Optimise sustainability performance and ensure compliance with sustainability-related guidelines in portfolio construction via integration into front office applications and processes.
Onboard and manage any kind of sustainability data or metric and create custom sustainability KPIs.
Integrate sustainability data and KPIs into core investment processes such as pre-trade compliance, what-if simulations, and post-trade monitoring and reporting processes.
Monitor sustainability performance and exposure holistically across all investments and get early warnings of risks and under-performance.
SimCorp's SFDR solution
In the second phase of EU's Sustainable Finance Disclosure Regulation, which is set to be introduced in 2022, financial firms will need to meet various reporting obligations. These include reporting and disclosing in detail the sustainability perspective of their investment processes and strategies.
They will also have to measure sustainability performance against specific KPIs. This requires tracking of sustainability KPIs in investment operations and distribution of KPIs to the periodic product level and enterprise level reporting.
SimCorp's SFDR solution enables the periodic reporting as prescribed by SFDR and EU taxonomy, but also integration of the SFDR KPIs into pre-trade and post-trade investment processes. This ensures that investment decisions are consistent and aligned with the KPIs that are reported to customers.
SimCorp's SFDR solution allows asset managers, including Danske Bank, to:
Enable SFDR related reporting, by providing relevant KPIs, i.e. PAIs and EU taxonomy alignment at position, product, and enterprise level.
Optimize sustainability performance of investment products, by integrating KPIs into front office applications
Simplify onboarding of SFDR related data by using standardized interface data feeds.
SimCorp provides integrated, best-in-class, multi-asset investment management solutions to the world's leading asset managers, fund managers, asset servicers, pension and insurance funds, wealth managers, central banks, sovereign wealth funds and treasury. Deployed on premise or in the cloud, SimCorp's core solution, SimCorp Dimension®, alongside SimCorp Coric®, SimCorp Gain™ and SimCorp Sofia™ form a powerful and complete solution. Together with a range of managed services, they support the entire investment life cycle, based on a market-leading IBOR. SimCorp invests around 20% of its annual revenue in R&D, helping clients develop their business and stay ahead of ever-changing industry demands. Listed on Nasdaq Copenhagen, SimCorp is a global company, with regional offices across Europe, North America, and Asia Pacific. For more information, please visit www.simcorp.com.
SimCorp: Tobias Brun-Falkencrone - +4529381384 - Tobias.Brun-Falkencrone@simcorp.com