Banks Urged To Integrate ESG Data Into IT

Banks are called to integrate ESGrelated data into their IT systems and processes in order to keep pace with regulator changes and consumer needs, McKinsey said in a report.

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BANKING TECHNOLOGY

“Banks must adapt their IT systems to systematically collect, aggregate, and report on a broad range of ESG data. However, many financial institutions still do not have a comprehensive approach to integrating ESG data into their existing risk reporting,” said report authors Henning Soller, Daniel Heller, Andreas Reiter, and Sebastian Schöbl in “ESG data governance: A growing imperative for banks.”

Moving toward this goal will require significant changes to the IT infrastructure, Soller and his co-authors noted. New applications include financed emissions models, climate risk models, ESG scorecards, climate stress tests, and climate-adjusted ratings.