Toronto-based fintech startup CapIntel, which is seeking to expand its U.S. business, is offering financial advisors a window into environmental, social and governance analysis that they can use to show clients how sustainable their portfolios are.
CapIntel, which specializes in automated proposal generation, workflow and fund analysis for advisors, announced the new ESG data component to the service Tuesday. The firm uses ESG data from MSCI to provide ratings, scores and various metrics for funds, portfolios and individual stocks.
The new ESG component is “presented in a compelling way that makes it easy for [clients] to understand,” CapIntel founder and CEO James Rockwood said. “Out of the box, there are five key customer-facing, simple to understand metrics.”
Those include a letter-based score for the fund, portfolio or stock, ranging from a high of AAA to a low of CCC; the security or portfolio’s alignment with an average global temperature rise of 1.5 degrees C; the carbon emissions per $1 million in sales; an ESG score relative to peers; and a global ESG score. The service lets advisors compare securities side-by-side.
The target groups for the service — financial advisors and asset management wholesalers — can also add ESG data points from about 230 others that MSCI provides, Rockwood noted.
“We wanted to be really careful with the amount of data we provided. It should not be overwhelming,” he said.
For advisors, the newly available ESG information can help in conversations with existing clients who have recently heard about sustainable investing, he said.
“It’s part of what we call ‘the modern investor,’ the boomer who is being influenced by a millennial child,” he said. “They’re having conversations at the dinner table around ESG.”
Last year, Charles Schwab gave its DIY investors access to MSCI's ESG data on individual securities, helping them build their own sustainable portfolios.
In 2022, CapIntel's Series A funding totaled $11 million, giving the firm resources to hire a planned 150 additional staff, as part of its goal to expand in the U.S. During the year, the company grew its head count by 185%, with a total staff of 60.
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