SIX acquires ESG analytics firm as industry races toward societal impact

Rick Steves

Orenda analyzes and quantifies social media data to provide insights, quantify public perception, and identify values that resonate with customers and stakeholders. Organizations and investors are then able to make better decisions based on real-time metrics.

SIX Group has taken a majority stake via growth investment in Canada-based Orenda Software Solutions, an AI-powered platform specialized in ESG and alternative data sets. The transaction is expected to close in Q1 2021.

As the ESG theme takes over the trading industry, SIX Group signals intentions to take the lead. The exchange group has recently listed its first ESG indices and decided to take one step forward by investing in Orenda.

The Canadian data analytics firm provides real-time, high-frequency ESG scores and insights into a company’s reputation to help measure the sustainability and societal impact of an investment.

Orenda analyzes and quantifies social media data to provide insights, quantify public perception, and identify values that resonate with customers and stakeholders. Organizations and investors are then able to make better decisions based on real-time metrics.

The ESG data specialist was founded in 2015 and delves in the fields of artificial intelligence, alternative data, social science, and finance.

Marion Leslie, Head Financial Information & member of Executive Board at SIX, said: “With Orenda we have found the right partner with unique expertise in alternative data sets, data science, and ESG. As we bring our capabilities and the expertise of our teams together, we see a lot of opportunities to build new propositions supporting the growth of impact investing.”

Tanya Seajay, founder and Chief Executive Officer of Orenda, commented: “SIX has a strong commitment to both innovation and sustainability. We had previously announced a sales partnership with SIX, this new step enables Orenda to accelerate its expansion to a much broader global customer base and to develop new solutions that combine the vast securities database of SIX and Orenda unique skillset.”

Last week, Refinitiv announced its own ESG AI-based engine that locates content pertaining to specific companies as well as cities and countries while excluding corporate press releases, corporate websites, and regulatory filings. In sum, it minimizes the impact of corporate “greenwashing.”

The solution can be useful for quantitative investors who wish to enhance alpha generation and risk management, but also for discretionary investors who look to improve portfolio construction. Corporate clients can monitor market perceptions of their own and competitor firms, while regulators can use the data to direct investigations.

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