Wong Kok Hoi, chief executive officer of APS Asset Management, said that most companies’ share prices are often driven by ex-ante information. However, most ESG data providers only have historical or ex-post data. “So most of the things that data systems will look at will update once every three months or once every six months. Share prices don’t wait. There are many investors out there who want to act fast,” he said.
The importance of having local data sources is highlighted in the case of Luckin Coffee. The China-based coffee chain was exposed for accounting fraud in April 2020, but local Chinese media had already been reporting problems with the company two years before the scandal broke globally, pointed out Danny Goh, CEO of Nexus FrontierTech.
The more locally sourced these ESG information are, the greater the depth of a company’s data, extending down to its supply chain, he noted.
Nexus FrontierTech – which has developed a platform for ESG data analysis focused on Asian companies with APS Asset Management – gives clients the ability to customise ESG data. “This allows investors to take on different investment strategies,” said Derrick Liao, chief operating officer of Nexus FrontierTech. “It also reduces dependence on ESG ratings that may not capture the quality of a company.”
Assessing Asian companies using global standards also means judging them through a European lens, said Goh. And Asian startups feel they are in a better position to make these assessments.
Read the full article here: https://www.businesstimes.com.sg/esg/startups-rise-solve-esgs-data-problems
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