Our client, a leading European bank, was looking to become a leader in sustainable investment, in turn increasing its sustainable assets under management and brand reputation. Sustainable investments is the fastest growing asset class globally, however our client had not fully optimized its platforms and operations to address this market. A central challenge within their asset management team was the lack of ESG (Environment, Social and Governance) data integration and interactive reporting and analysis. The client partnered with Virtusa to identify issues and design and build a sustainable investment platform to address their strategic goals and drive efficiency and allow for better investment decisions.
The ChallengeThe client was utilizing an outdated platform for analyzing sustainability data.
The existing platform only covered Equity needs, and failed to meet surging demands from internal stakeholders, customers and regulatory guidelines. Some of the key challenges included:
- Non-standardized frameworks and models for data ingestion: The client receives various forms of ESG data in different standards and formats from multiple ESG data providers such as Sustainalytics and MSCI. The client lacked the required frameworks and tools to integrate the multi-format data for a consolidated view, creating inefficiencies in investment analysis and decisioning.
- Inefficient platform with limited data analysis capabilities: The client’s existing platform relied on manual processes, preventing asset and portfolio managers from quickly determining investment outputs based on customers’ sustainability investment preferences. Manual processes to manage and apply rules to investment data, resulted in long lead times. It also increased the probability for manual errors, hindering efficient decision making, leading to dissatisfied customers and potential fines.
- Dependence on basic tools and methods: The client’s portfolio management team relied on basic software, including MS Word and MS Excel to document sustainable investment inputs. Tracking, logging and analyzing this data proved cumbersome, resulting in longer working hours and reduced efficiency. It also led to an inability to monitor company progress towards their sustainability goals, hindering the prospect of including them in future investment decisions.
Virtusa built a sustainable investment platform, post a 6 week Accelerated Solution Design (ASD) phase which involved analyzing current state processes, identifying bottlenecks, and designing the ideal future-state.
Key features of the solution include:
- Automated sustainable investment data ingestion
- Single interactive view of amalgamated data from multiple sources
- Notes/dialogue logging of remote client sessions digitally via user interface
- Inbuilt portfolio rules and criteria management for customized data analysis
- Custom reporting and visualisations for better forecasting
- Leveraged Hyper Distributed Agile framework for greater value and scale
- Docker images utilized for platform build to meet potential future requirements (enabling ease of migration from on-prem to cloud)
With Virtusa’s bespoke sustainable investment platform, the client’s analysts and portfolio managers were now able to pay more attention to value-adding activities that allowed them to focus on making sustainable investment decisions.
Some of the estimated benefits include:
- Up to 58% reduction in end-to-end manual processes
- ~313 hours saved per analyst per annum with zero delay in updating rules, criteria, and ESG data sets
- Zero extra software documentation required to support, run or maintain the new process
- Enhanced decision making by providing analysts and portfolio managers with well-defined criterion and rulesets for better analysis
- Improved operational efficiency by enabling digital logging of elements such as interview outputs, dialogue notes, company sustainable performance tracking, and simulations