Sustainable investments have been in vogue in recent years. In the meantime, they are a matter of course for almost every institutional and private investor. For example, in Q1 2022 alone, the assets invested in mutual funds with sustainability features in Germany rose to 563 billion euros, which corresponds to an increase of 80% over the year.
As a result, a market for specialised ESG database providers established itself years ago alongside the classic rating agencies such as Moodys, Fitch Ratings or Standard and Poor’s (S&P). They collect environmental, financial and non-financial indicators and process them using their own methodology.
In this context, ESG database providers have also extended their data collection to unlisted and closed market companies. They now provide data for tens of thousands of companies. By using modern technology such as machine learning or artificial intelligence as well as automated evaluations, they manage this almost unbelievable amount of data.
On average, institutional investors use three to six different ESG databases and spend $1.3 million annually on ESG data alone. This leads to a lot of positive effects. The figures show that large companies are acting more and more sustainably.