This week, the FCA and the City of London Corporation hosted a demo day for their Sustainability Cohort initiative, designed to advance green finance and promote the transition to net-zero emissions.
Catherine McGuinness, Policy Chair at the City of London Corporation, expressed enthusiasm for the event: "This is immensely encouraging news that reaffirms London’s status as a leading hub for green finance. The collaboration between the public and private sectors is key to driving progress. This cohort of companies is poised to contribute to a more sustainable financial sector by tackling shared challenges such as ESG data and disclosure."
Running from November 4, 2021, to March 31, 2022, the Sustainability Cohort initiative seeks to address three major challenges in ESG information and disclosure:
- Data Understanding: How can technology enhance consumer comprehension of the ESG attributes of the financial products and services they choose?
- Data Automation and Validation: How can technology streamline the assurance process for a listed issuer’s ESG data and validate ESG-labelled corporate bond issuances?
- ESG Disclosure Transparency: How can technology improve transparency in sustainability reporting, focusing particularly on corporate assets and supply chains?
To tackle these challenges, the City of London Corporation and the FCA have reopened their Digital Sandbox, where 12 firms are innovating unique solutions. The outcomes of these developments were showcased during the demo day.
Key features of the sandbox include access to financial datasets for model development and testing, an API marketplace for connecting to a variety of existing fintech and regtech APIs, and an Integrated Development Environment (IDE) that supports code development and data analytics. Moreover, participants can collaborate with a diverse network of innovators, regulators, financial services firms, and investors.
Among the noteworthy projects emerging from the sandbox are QPQ, a deep-tech firm utilizing supply chain data to combat greenwashing, and Coriolis, which has created a digital platform enabling banks to assess the ESG health of companies, supply chains, and nations.
The Sustainability Cohort Demo Day attracted a wide array of participants, including market players, end consumers, sustainability experts, investors, academics, consultants, investment managers, and regulators. As the quarter progresses, all eyes are on the evolution of the solutions developed within the sandbox.