JPMorgan Product Reveals Wall Street’s Shifting Views on ESG

A new ESG product that JPMorgan Chase & Co. is about to start offering clients shows how rapidly perceptions are changing about the investment strategy. This according to a story in Bloomberg news. JPMorgan has teamed up with software firm Datamaran to develop a data-analysis tool for clients to gauge not just the environmental, social and governance risks facing portfolio companies, but also the ESG risks that such assets pose to the world around them. While the concept -- known as double materiality -- is already built into EU ESG regulations, it has yet to make inroads in the US. Double materiality is “the only way to think about ESG in a way that is both forward-looking and comprehensive,” said Jean Xavier Hecker, the Paris-based co-head of EMEA ESG research at JPMorgan and the architect behind the new tool called ESG Discovery. The tool now available to JPMorgan clients will use artificial intelligence to compile data from corporate disclosures, regulations and online media. It won’t provide an ESG rating or score, and will instead focus on unpacking individual ESG drivers. The idea is to centralize Datamaran’s AI tools and the ESG analysis of JPMorgan’s researchers in one place.