Business Situation
To deepen its responsible investment strategy and meet evolving sustainability expectations, the client, a premier European private bank, sought a partner to aggregate and validate high-quality environmental, social, and governance (ESG) and controversy-related data.
The engagement focused on:
- Mapping company activities to the client’s internal ESG framework and key performance indicators (KPIs)
- Developing a robust template and aggregation methodology for ESG metrics
- Aligning company practices with the 17 UN Sustainable Development Goals (SDGs)
- Capturing controversial activities and sanction risks across a global, multi-sectoral universe
SGA Approach
1. ESG Materiality & KPI Framework Design
- Identified and structured 197 ESG KPIs, tailored to the client’s internal framework and aligned with global ESG standards (GRI, UNGC, and TCFD)
- Developed SDG-mapped parameters based on sectoral relevance and impact thresholds across Environmental, Social, and Governance pillars
2. Tech-Driven Data Aggregation Using IDEAT
- Leveraged Intelligent Data Extraction and Tagging Tool (IDEAT), SGA’s proprietary artificial intelligence (AI)-powered platform, to:
– Auto-extract ESG disclosures from annual reports, sustainability disclosures, company websites, and regulatory filings
– Apply contextual business rules to enhance accuracy and standardization - Enabled automated flagging and categorization of reported KPIs per company, reducing manual effort and improving turnaround times
3. Human Expertise for Contextual Precision
- ESG domain experts filled contextual data gaps left by automated tools, ensuring completeness and relevance
- Reviewed sector-specific interpretations and company nuances to enhance qualitative insight beyond numeric data
4. Controversy & Sanctions Monitoring
- Deployed SGA’s AI-powered News Aggregator, capable of tracking over 12,000 global sources to monitor:
– ESG-related controversies
– Violations of UN Global Compact (UNGC) principles
– Involvement in tobacco, arms, alcohol, and sanctioned entities - Weekly intelligence reports flagged emerging and material controversies, tagged by sector, geography, and company
5. Ongoing Monitoring & Publication Tracking
- Implemented Publication Monitoring Tool (PMT) to track and ingest new ESG disclosures as soon as they are released
- Enabled dynamic updates to ESG profiles for continuous alignment with evolving public data
6. Template, SOP & Guideline Development
- Created customized data collection templates and step-by-step standard operating procedures (SOPs) for all 197 KPIs
- Enabled internal teams at the bank to replicate and scale ESG evaluation processes with confidence and consistency
Key Takeaways
Holistic ESG + SDG View: 197 KPIs and SDG-mapped dimensions enabled a comprehensive 360° ESG risk-opportunity assessment
Smart Automation + Human Judgment: Combination of AI-powered data engines and ESG experts delivered speed without compromising accuracy
Real-Time Controversy Alerts: News monitoring provided real-time visibility into ESG incidents and helped mitigate investment and reputation risks
Future-Ready ESG Platform: SOPs, templates, and frameworks established a foundation for continuous ESG evaluation, aligned with global standards and internal policy evolution
