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Northern Trust Asset Management Launches Sustainable Quantitative Solutions

Strategies Support Desire for Sustainability – Without Sacrificing Performance

Published 01-20-20

Submitted by Northern Trust Corporation

Northern Trust Asset Management, one of the world’s leading investment managers, has announced the further expansion of its sustainability strategies, enabling institutional investors to combine Environmental, Social and Governance (ESG) investing solutions with the manager’s expertise in quantitative investing across developed and emerging markets.

The Emerging Markets Quality Low Carbon Strategy aims to tackle climate change risk while enhancing performance through the integration of Northern Trust’s proprietary Quality factor, which targets companies that are efficiently managed, profitable, and have strong cash flows.

Designed to invest at the intersection of low carbon and high quality, the strategy is an example of Northern Trust’s approach of delivering quantitative investment solutions that focus on the efficient use of risk – without sacrificing performance. Driven by client demand, the strategy is executed using the investment manager’s proven record of innovation in ESG and quantitative investing.

“Having been at the forefront of ESG innovation for nearly 30 years, we’ve seen investors’ attitudes evolve over time,” said Marie Dzanis, head of Northern Trust Asset Management, Europe, Middle East and Africa. “Today’s investor not only wants to live their values – they want to partner with firms which can help them invest their values. At Northern Trust Asset Management, we’re passionate about identifying, building and delivering effective, responsible investment solutions – and we believe this can be achieved without sacrificing financial performance.”

“The quality of emissions data is constantly improving and this, coupled with the sophistication of our quantitative techniques, means we are in a strong position to combine Northern Trust’s core competency of quantitative investing with climate change investment considerations,” said Mamadou Abou-Sarr,  global head of product development at Northern Trust Asset Management. “Our focus is to help investors avoid unintended risks and sector biases within their portfolios by targeting exposure to risk factors – achieved through our range of tailored strategies.” 

The Emerging Markets Quality Low Carbon Strategy provides investors an environmentally cleaner exposure to emerging markets equities with a carbon intensity reduction target of 70 percent.

Other strategies, including Europe Value ESG, North America Value ESG or Emerging Markets Multifactor ESG, incorporate a set of norm-based and business-involvement screens. Within an end-to-end risk management framework, the strategies employ a proprietary multi-factor model using value, quality and momentum to score all investable constituents.

Northern Trust Asset Management also recently announced it had launched a World Green Transition Index Strategy, Small Cap ESG Low Carbon Index Strategy and has added thermal coal screens to its existing suite of Custom ESG Index Strategies to align with evolving investor preferences.

Entrusted with US$975 billion of investor assets, Northern Trust Asset Management is among the world’s largest investment managers. The firm helps investors navigate changing market environments so they can confidently realize their long-term objectives. It has more than 30 years of sustainable investing expertise and innovation, is a UNPRI signatory and manages three of the top 10 largest ESG index funds globally (eVestment data as of June 30, 2019).

About Northern Trust Asset Management

Northern Trust Asset Management is a global investment manager that helps investors navigate changing market environments, so they can confidently realize their long-term objectives. Entrusted with more than $900 billion of investor assets, we understand that investing ultimately serves a greater purpose and believe investors should be compensated for the risks they take — in all market environments and any investment strategy. That’s why we combine robust capital markets research, expert portfolio construction and comprehensive risk management to craft innovative and efficient solutions that deliver targeted investment outcomes. As engaged contributors to our communities, we consider it a great privilege to serve our investors and our communities with integrity, respect, and transparency.

Northern Trust Asset Management is composed of Northern Trust Investments, Inc., Northern Trust Global Investments Limited, Northern Trust Fund Managers (Ireland) Limited, Northern Trust Global Investments Japan, K.K., NT Global Advisors, Inc., 50 South Capital Advisors, LLC, and investment personnel of The Northern Trust Company of Hong Kong Limited and The Northern Trust Company.

About Northern Trust

Northern Trust Corporation (Nasdaq: NTRS) is a leading provider of wealth management, asset servicing, asset management and banking to corporations, institutions, affluent families and individuals. Founded in Chicago in 1889, Northern Trust has a global presence with offices in 20 U.S. states and Washington, D.C., and across 23 locations in Canada, Europe, the Middle East and the Asia-Pacific region. As of September 30, 2019, Northern Trust had assets under custody/administration of US $11.6 trillion, and assets under management of US $1.2 trillion. For 130 years, Northern Trust has earned distinction as an industry leader for exceptional service, financial expertise, integrity and innovation. Visit northerntrust.com or follow us on Twitter @NorthernTrust.

Northern Trust Corporation, Head Office: 50 South La Salle Street, Chicago, Illinois 60603 U.S.A., incorporated with limited liability in the U.S. Global legal and regulatory information can be found at https://www.northerntrust.com/terms-and-conditions 

IMPORTANT INFORMATION. This information is directed to eligible counterparties and professional clients only and should not be relied upon by retail investors. The information is not intended for distribution or use by any person in any jurisdiction where such distribution would be contrary to local law or regulation. This report is provided for informational purposes only, does not take into account the individual circumstances of each investor and is not intended to be, and should not be construed as, an offer, solicitation or recommendation with respect to any transaction and should not be treated as legal advice, investment advice or tax advice. The information is believed to be correct and accurate but may be subject to change without notice.

Investing involves risk- no investment strategy or risk management technique can guarantee returns or eliminate risk in any market environment.

Northern Trust Asset Management is composed of Northern Trust Investments, Inc. Northern Trust Global Investments Limited, NorthernTrust Fund Managers (Ireland) Limited, Northern Trust Global Investments Japan, K.K, NT Global Advisors Inc., 50 South Capital Advisors LLC and investment personnel of The Northern Trust Company of Hong Kong Limited and The Northern Trust Company.

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Northern Trust Corporation

Northern Trust Corporation

Northern Trust is a leading provider of asset servicing, fund administration, investment management, banking and fiduciary solutions for corporations, institutions, and affluent individuals worldwide.

Since 1889, when Northern Trust was founded in Chicago, we have aligned our efforts with our three guiding Principles That Endure: Service, Expertise, and Integrity. Together, they reflect the three cornerstones of business conduct which we strive to instil in our employees, whom we call partners, and to provide to our clients and the communities we serve worldwide.

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