Asia Awards 2023: Best ESG data provider—RavenPack

Overview

RavenPack’s ESG Controversy Scoring framework gauges a firm’s ESG controversy exposure over time via real-time news monitoring. Sustainability data is often unstructured, making it hard to systematically consume and identify signals. Addressing this data challenge is key to establishing a robust ESG strategy, as investors rely more on data-driven processes for scale and efficiency in ESG applications.

The solution

RavenPack’s ESG Controversy Scoring framework uses real-time detection of events from over 40,000 news sources in 13 languages to assess a firm’s ESG controversy exposure. The firm’s taxonomy includes nearly 7,400 events, with 171 related to ESG controversies, providing high specificity in measurement.

Secret sauce

RavenPack’s ESG Controversy Scoring framework is based on the firm’s natural language processing (NLP)-driven event-detection capabilities, with a high level of granularity (more than 7,400 event categories identified). The process is fully transparent, down to the news article. In comparison, packaged ratings from major rating agencies rely on relatively opaque analyst views that tend to be slower to react to breaking news events.

Recent milestones

• Research-backed business application: RavenPack analyzed the relationship between events detected within its ESG Controversy Scoring framework and share prices of listed equities. Integrating controversy-based signals into investment strategies can beneficially impact portfolio performance.
• Launch of ESG Controversy Top Movers report: Weekly digest of top 10 most controversial corporate moments (https://www.ravenpack.com/controversy)
• Ongoing improvement of ESG event detection capabilities

Future objectives

• Leverage Controversy Scores in different settings, such as sector rotation strategies and partner with index providers to build investable indexes that use alpha-augmenting controversy overlays
• Explore new markets and business applications, such as expanding access to controversy scores for discretionary investors using targeted tools
• Explore additional research that can underpin cross-asset strategies using controversy data

Why they won

RavenPack, a Marbella, Spain-based data specialist, wins its first ever WatersTechnology Asia award thanks to its ESG Controversy Scoring framework, which is designed to monitor a firm’s ESG controversy exposure over a period of time via real-time news monitoring. This is an increasingly important aspect of the ESG market and one that is both complex and labor-intensive. RavenPack’s strategy entails real-time detection of events from over 40,000 news sources in 13 different languages to assess a firm’s ESG controversy exposure, thus providing transparency and granularity to an area of the ESG sector mired in opaqueness.