Reflection Analytics, an ESG investment evaluation company, has launched a new platform, Reflect, that provides investor-focused ESG analysis for asset managers, financial advisers, and investors and institutions.
Marketed as the industry’s only Names Rule-compliant software, Reflect provides an investor-focused rating that scores companies across 250 data points in 18 ESG sub-themes. In September, the SEC expanded the Names Rule, formally titled Rule 35d-1, to crack down on greenwashing and deceptive or misleading marketing practices by investment funds.
Under the expanded rule, asset managers have 24 months to begin reporting on their alignment, demonstrating that 80% of their investments are in securities that reflect the terms in their name.
“The big ESG ratings agencies aren’t evaluating companies from the investor’s perspective — which the expanded SEC Names Rule requires — but rather are looking at them from a corporate management perspective, which is a real problem,” Jason Britton, founder and CEO of Reflection Analytics, said in a news release. “With existing rating methodologies, a company like McDonald’s could have a higher ESG rating than a business focused on reducing greenhouse gases and cleaning up waste.”
After analyzing an investment portfolio, Reflect provides a real-time, percentage-match score, rating investments across 18 sub-themes ranging from “not aligned” to “strongly aligned,” the company said in the news release. Reflect can also weigh an existing portfolio against a curated list of investments, allowing individuals and institutions to compare assets via a side-by-side analysis.