Sustainability lies at the core of Qontigo’s DNA
STOXX Qontigo: Best Index Provider (ESG ETFs) – Qontigo, part of the Deutsche Börse Group, took sustainability to another level in 2020, with the arrival of Rodolphe Bocquet (pictured) as Global Head of Sustainable Investment for the firm and the establishment of an internal system that would allow the design of a long-term sustainable investing strategy across the company.
Bocquet explains that he is liaising with every other part of the organisation with a mission to advise, empower and inspire the whole company. “We are not just a team for sustainable investing,” he says, “but the whole company is doing sustainable investment. It’s at the core of our DNA.”
The company’s new tag line reflects its renewed commitment to making a change: Optimizing Impact.
“Not only the historical financial impact but also the societal impact,” Bocquet says. “We see it is a growing need from our clients, becoming part of their fiduciary duty, and there is a growing demand from retail investors and advisers to ensure that their investment solutions match their values so it needed to be at the core of our investment strategy.”
As a firm, Qontigo believes in open architecture. “We offer our clients best of breed ESG data, not necessarily our own, as we partner, sometimes within the Deutsche Börse group´s sister companies but also, beyond that, working with external firms.
“Open architecture brings to clients this promise that depending on their specific need for ESG, they can find the best of breed sustainability ESG data and modelling infrastructure. Plus, our own view and model which allows our clients to onboard their datasets. We are supporting the client and finding the solution that matches their needs.”
Bocquet believes that there are now three dimensions in investing. “The classic risk and return dimensions have now a third dimension in social impact,” he says.
“The new efficient frontier is three dimensional with social impact which will create very different efficient frontiers from one client to another.”
Last year saw Qontigo issuing its first STOXX Paris-aligned benchmark indices. “Going above and beyond the new regulations, we added in additional criteria, including a scheme under which we can progressively divest those who have not committed to the Science Based Targets initiative (STBi).”
Looking toward 2021, there are two main new initiatives that Bocquet believes will complement Qontigo’s existing offers for ESG-derived benchmarks. “We will have five different flavours available for all of our benchmarks by Q2, including inclusion and exclusion criteria for ESG factors,” he says.
The intention is to launch a brand-new grid of indices, with more impact, and develop them around certain sustainability megatrends such as the circular economy, low carbon energy, the supply of sustainable food and the development of sustainable cities.
“We are not just an index provider but also an analytics company. And the analytics’ intelligence and the state-of-the-art properties of Axioma within Qontigo is developing optimisation that specifically matches customer demand,” Bocquet says.
“We have worked with an asset owner to develop a very specific benchmark, onboarding some of their own factor models in ESG and optimising the minimisation of tracking error and having the ability to rely on the best of breed optimisation provided by Axioma.”
Rodolphe Bocquet, Global Head of ESG, Qontigo
Rodolphe Bocquet leads Qontigo’s expansion of indexing and analytics in the ESG space as Global Head of ESG. A pioneer and innovator in ESG investing, Rodolphe most recently served as an independent sustainability consultant working with a range of clients, including the World Bank and the Inter-American Development Bank. In 2014, he co-founded and served as Chief Executive Officer of Beyond Ratings, a startup created to better integrate long-term sustainability drivers and their impact on investments. Beyond Ratings was acquired by the London Stock Exchange Group in May 2019.