Nexus FrontierTech and APS Asset Management are jointly developing a platform for environmental, social and governance (ESG) data analysis on companies with principal offices or significant business activities in China, Hong Kong, Macau, Taiwan and Singapore that issue equity and equity-related securities.
Implementing sustainable investments within the asset management sector has historically been mired by multiple data-related challenges, including poor quality data, low data availability and lack of harmonised or interoperable ESG disclosure standards and frameworks.
The partnership between Nexus FrontierTech and APS Asset Management sought to resolve these challenges, and together the two entities are currently conducting a proof-of-concept (PoC) to demonstrate the technical feasibility and potential business value of combining artificial intelligence (AI) with APS’ ‘four alpha-hats’ investing approach, designed and built on an ESG platform that is underpinned by an integrated, scalable, cloud-based technology stack.
With a modular, API-ready infrastructure and AI-native capabilities, the ESG platform has the potential to scale to cover additional markets, integrate with various data providers, such as the Greenprint ESG Registry, and serve as a data aggregator for asset management end-users.
The successful automation of various manually tedious research workflows is expected to increase the productivity of investment analysts by 50 to 70 per cent, freeing up more time for them to concentrate on higher-value tasks and functions, such as fundamental analysis.
The project was awarded the Monetary Authority of Singapore’s (MAS) financial sector technology and innovation (FSTI) POC grant back in June of this year and will provide funding support for experimentation, development, and dissemination of nascent innovative technologies in the financial services sector.
Speaking on the development of China’s first real-time AI-fundamental ESG system, APS Asset Management CIO, Wong Kok Hoi, confirmed the company’s belief that the platform is “a powerful system developed by combining Nexus AI expertise and APS’ multi-decade experience in fundamental analysis of Chinese companies.”
Adding to this, Danny Goh, CEO of Nexus FrontierTech, comments: “The solution will connect international ESG reporting standards, disclosure practices in developing countries like China, and investment management approaches in Singapore, adding to Singapore’s growing pool of intellectual capital and capabilities as a global centre for sustainable finance.”
The platform was also recognised at the Global Fintech Hackcelerator 2021, winning a top 10 finalist position in the local programme.
Nexus FrontierTech and APS Asset Management continue to develop the ESG platform collaboratively, scaling it to expand the total addressable market data, and building a new ESG data research management repository.