12 Jan 2018:

Responsible Investing: Using AI to tap demand for socially responsible investments

Socially responsible investing (SRI) is becoming more mainstream, driven by investor demand for companies that adhere to environmental, social and governance (ESG) principles in their operations. However, it is often difficult to collect such data from these companies as it can be inconsistent or all over the place.

To bridge this gap, UK-based investment management firm Arabesque Asset Management Ltd created a programme called S-Ray to actively track and analyse data using artificial intelligence (AI) and subsequently churn out ESG and United Nations Global Compact (GC) scores for each company. The two global standards review the performance of corporations in areas such as human rights, labour issues, anti-corruption, environment and transparency of governance.

BIMB Investment CEO Najmuddin Mohd Lutfi says using AI in asset management will help reduce and manage market risks because the decisions are made based on more information.

This article first appeared in Personal Wealth, The Edge Malaysia Weekly, on December 18 – 24, 2017.