Governance, risk and compliance advisor ACA Group has acquired ESG ratings data and software firm Ethos ESG in an undisclosed deal.
Ethos ESG provides its service to financial advisors, asset managers, institutions and investors.
The company offers an interactive platform that enables the evaluation of over 350,000 impact ratings including companies, stock and funds through a prism of 45 ESG causes such as climate change, racial justice, mental health and more.
Ethos provides full transparency into how each impact score is calculated and the ability to upload portfolios and create models, the firm allows for GRC professionals to understand the ESG characteristics of their investments and make decisions that align with their values and ESG commitments.
The firm uses a set of approximately 100 underlying databases to generate its ratings. These said databases provide an impact view of ratings, as well as provide insight into key metrics where available. The databases are fully transparent, so clients can see which underlying database each data point comes from.
According to ACA, the acquisition marks its first analytics offering, which will be paired with the firm’s ESG experts to form an integrated tech and advisory offering under the ESG practice.
ACA’s existing ESG practice specialises in advising on policies, procedures, and alignment with regulations and voluntary framework. With Ethos, ACA clients will have a tool to implement the procedures suggested by advisory, analyse investments, and automate several elements of ESG reporting.
Ethos recently launched its Impact Calculator, a widget that takes a dollar amount and immediately calculates the real-world equivalent impact of investing that amount in a specific fund or other product.
The business also recently introduced its Carbon Neutral Certification program for mutual funds and ETFs. Through the certification, Ethos performs an independent analysis of a funds carbon footprint (covering Scope 1 and Scope 2 emission) and carbon credits (offsets) to verify whether the fund is carbon neutral during a specified period.
ACA Group CEO Shvetank Shah said, “This is an exciting step in helping to grow our presence in the ESG space and is ACA Group’s first foray into analytics as a service. We are invigorated to be building out and launching our data capabilities, starting with Ethos ESG. Combining data with our scalable solutions will continue to empower our clients to reimagine GRC and protect and grow their business.”
Ethos ESG founder and CEO Luke Wilcox added, “We are thrilled to partner with ACA Group, as their brand and reach in the GRC space is well-known. Not only is taking into consideration the ESG impact of your decisions right on its merits, but greater transparency into ESG issues helps firms mitigate risk and make informed choices while growing sustainably.”
Earlier this year, ACA Group appointed Neeraj Karhade to the role of chief financial officer.
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Copyright © 2018 RegTech Analyst