Deutsche Bank and Arabesque Partners today announced the launch of a new family of investment products that apply a proven quantitative stock selection mechanism to environmental, social and governance (ESG) investing.
The products will track the returns of the Arabesque Prime and Systematic indices which are designed and operated by Arabesque.
These indices mimic in a systematic transparent manner the trading strategies employed by Arabesque for their ESG-funds.
Arabesque is the world’s first specialist ESG Quant asset management firm. The name “Arabesque” describes geometric art built with mathematical equations. The firm’s investment technology processes over 100 billion data points to select an investment universe of global stocks that deliver superior returns, integrating ESG data with quantitative investment strategies. Based in Frankfurt and London, Arabesque’s mission is to make sustainable investing attractive and available to all investors.
The firm screens thousands of stocks to identify around 1000 companies which comply with its corporate responsibility guidelines and demonstrate strong environmental, social and governance performance.
It then applies a range of other non-ESG filters to these companies to identify which companies score highly on other criteria such as financial stability, earnings momentum and market sentiment.
Deutsche Bank is partnering with Arabesque as it is the leading specialist firm that fits the bank’s requirements: strong ESG-framework, quantitative focus, and a flexible offering.
Sean Flanagan, Head of Equities & Hybrids Structuring Europe at Deutsche Bank, said: “The aim of the partnership is to allow investors to invest in a sustainable way without having to sacrifice return performance. There is a widespread assumption that sustainability comes at a cost, which is a reduced rate of return. But Arabesque’s combination of environmental, social, and governance selection criteria and performance has challenged that assumption.”
“Deutsche Bank has seen a strong increase in demand for ESG based products over recent years. We see the cooperation with Arabesque as a crucial step to develop our ESG-footprint and continue building our ESG platform. The topic will keep growing in relevance and Deutsche Bank wants to play an active role in this development.”
Omar Selim, Chief Executive Officer at Arabesque Partners, said: “The integration of non-financial information into the investment process is fast becoming a global trend and today, people care more than ever before about precisely how financial return is generated. This trend is gathering momentum: 5,336 companies published a sustainability report in 2014, up from 294 in 2004 1) . Investors can now clearly see that ESG and financial performance go hand in hand.”
Andreas Feiner, Head of ESG Research and Advisory at Arabesque Partners stated: “ESG-based investing is one of the most significant trends in financial markets for decades. Over time, it will not be a question of whether investors will integrate ESG information in their portfolio selection but moreover when, how and with whom.”
1) GRI, Sustainability disclosure database, 2015, http://goo.gl/MAhrnk
For further information please contact:
Deutsche Bank AG
Press & Media Relations
Dr. Axel Lüdeke
Phone: +49 (69) 910 41750
Phone: +44 (0) 20 754 57866
Press & Media Relations
Phone: +44 (0) 7917 700 770
About Deutsche Bank
Deutsche Bank provides commercial and investment banking, retail banking, transaction banking and asset and wealth management products and services to corporations, governments, institutional investors, small and medium-sized businesses, and private individuals. Deutsche Bank is Germany’s leading bank, with a strong position in Europe and a significant presence in the Americas and Asia Pacific.
About Arabesque Partners
Arabesque is the trading name of Arabesque Asset Management Ltd, a limited liability company registered in England and Wales at 68 Brook Street, London W1K 5DZ (no. 8636689), also operating through its branch, Arabesque Asset Management Ltd (Germany), registered in Frankfurt-am-Main at Zeppelinallee 15, 60325 Frankfurt am Main, Germany (no. 103816).
Arabesque offers an asset management service combining portfolio management technology with the values of the UN Global Compact, the Principles for Responsible Investments (PRI) and balance sheet/business involvement screenings. Arabesque’s management team comprises experienced specialists from international investment banks and asset managers. Arabesque has staff in London, Frankfurt and New York. Leading industry professionals and academics have committed themselves to Arabesque’s Advisory Board.