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Fintech partnerships that are driving Environmental, Social and Governance standards in Capital Markets
Leading Role of ESG in Investment and Procurement
Since the dawn of the 21st century Corporate Social Responsibility, ethically conscious business and the Environmental, Social and Governance (ESG) agenda have been key drivers in Capital Markets’ investment and procurement activity.
According to Morgan Stanley’s 2020 Social Investment Forum report there are approximately 17 trillion dollars invested in sustainable funds under professional management in the US.
Not only does this represent an increase of 42% in sustainable investments since 2018, it also highlights how environmental concerns and ethical business criteria are driving a third of capital investment – with numbers growing exponentially.
Yet attractive yields from sustainable funds are no longer sufficient for individual and institutional investors. Market participants are demanding positive environmental and social impacts as much from their providers as from their portfolios.
In response, market providers old and new are investing heavily in their own ESG programmes, and forging exciting partnerships with other Fintech suppliers to ensure their offerings remain at the forefront of the ESG agenda.
Sustainable Technology
One such partnership is that of Beeks Group, an outstanding specialist in managed cloud computing for the financial markets since 2011 and IPC, the world’s leading provider of secure, compliant communications and multi-cloud connectivity solutions for the global financial markets.
For years IPC has been investing in sustainable technologies and best practices to reduce their carbon footprint and deliver the most flexible solutions for their customers.
“Sustainability is a key factor in supplier selection for our business,” asserts Jonathon Hogg, Chief Risk Officer with IPC. “The state-of-the-art technology from Beeks enables us to nudge our customers to energy- and cost- efficient cloud trading environments.”
Beeks CEO Gordon McArthur and his team have made sustainability, efficiency, cost-effectiveness, risk reduction, agility and security core features of all their offerings, neatly dove-tailing with the ESG demands of providers and participants.
High Density Green Compute
Explaining Beeks’ most recent dedicated server hosting solution Gordon says: “Proximity Cloud features high density compute racks accommodating up to 80 servers within a data centre.
“By fitting up to 8 times more servers in a rack than other providers we help organisations reduce data centre footprint and achieve natural efficiencies in power consumption, cost and cooling.”
Co-locating in data centres owned by Equinix, Beeks and their customers also benefit from Equinix’ Corporate Sustainability Programme, ensuring reduced power consumption and heightened energy efficiency for cooling and lighting across the whole site.
Optimisation
Every ESG sensitive operation would favour monitoring, fine-tuning and improving their existing infrastructure over acquiring new kit. This is also where Beeks’ technology steps in.
“We offer cloud-based Analytics as a Service enabling businesses to get more granular insight into how their networks are performing, and how to optimize the existing stack,” continues Gordon.
“With no more than a cross-connect cable customers can become Analytics consumers. There are no additional up-front costs or hardware requirements.”
Agile expansion
While institutions are compelled to expand into increasingly diverse markets, they wish to do so without risk and at speed.
“Beeks’ commercial model allows firms to commit for a shorter period of time than an on-prem data centre would demand,” Gordon explains.
“Beeks’ IaaS eliminates the need for extra hardware; meaning less capital spend, more sustainable co-locations, and more rapid and cost-effective expansion into global, diverse and inclusive markets.”
Social Benefits
“IPC and our customers are benefitting massively from our commercial partnership with Beeks, so it’s great that we also have a strong social focus with Gordon’s team too,” says Jonathon Hogg.
“Our shared passions for competitive sport have inspired us to jointly sponsor a couple of sports clubs – one an African football club and the other a Scottish swimming team!”
“We are also jointly committing to make a donation to local charities on the launch of a new Data Centre instance,” Jonathon explains.
“Since Beeks helped us build out 10 new data centres in 6 months at the height of the 2020 pandemic this could be very good news for charities around the world!”
Good Governance
Next to sustainability in Capital Markets, there are few things more important than good governance, with security, continuity and regulatory compliance being core components to mitigate risk and build trust.
Beeks & IPC are well-practiced in the art of aligning their technology with the regulators’ requirements; and IPC’s dedicated Corporate Risk function ensures their partnership activity is compliant with local laws.
Furthermore, the CISOs of both IPC and Beeks work closely together to ensure that their respective environments operate with security as a built-in aspect of the product suite, including service orientated controls to maximize security of information.
Graeme Marsh, Beeks Chief Information Security Officer explains: “Having learned the hard way, Beeks will always aim for a strong security posture, and have achieved accreditation from a number of regulatory bodies, including ISO27001, the Center for Internet Security Controls (CISC), UK-governed National Cyber Security, and the National Institute of Standards and Technology (NIST).”
IPC Chief Information Security Officer, John Gardner is at the forefront of IPC’s security function and states: “IPC takes the security of information very seriously across both corporate and product environments.”
“The evolution of hosted technology and our partnership with Beeks come hand-in-hand with a SOC 2 roadmap. This supplements our ISO framework, strong anti-phishing campaign, and ransomware preparedness so that we can inspire confidence in our customer base.”
Dan James, IPC Global BCP & IT DR Officer, ensures business continuity is a key pillar of IPC’s offering; and customers have the comfort of sound disaster recovery programs.
Dan comments: “IPC conducts regular BCP and IT DR testing on our corporate and product environments. Along with tabletop scenarios covering a host of topics, formal IT DR testing takes place on IPC’s products operating within the Beeks environment.”
Integrating Sustainability
Two decades into the new millennium, market participants can now be confident their pursuit of ethical and sustainable trades is not the only corporate ESG must-have that is an achievable reality.
The best technology providers in the sector are matching institutions’ ESG demand as far as the very data centre location and product suite they deploy within trading environments. This enables organisations to integrate sustainability into their infrastructure.
“Both IPC and Beeks have built our reputation on responding directly to our customers’ needs and requirements, and reflecting these in our solutions,” asserts CEO Gordon McArthur.
“We figure out what people need then we get it to them cheaper and faster than anyone else.
“ESG requirements are no different. The efficiencies, economies of scale, ease of deployment and sustainability of dedicated server hosting, low latency IaaS, Analytics and secure connectivity are and always have been Beeks’ bread and butter.
“Adding these benefits to IPC’s offering and joining forces with them in a shared ESG programme means we can substantially enhance the sustainability of the financial sector and help improve communities all round the world.”
Meanwhile, IPC’s ESG report 2021 will soon be available, detailing their full, global carbon footprint calculation. The organisation is also anticipating imminent ISO 14001 accreditation.
“On the basis of the information collated through supplier engagement for our product footprint and our designated ESG liaisons for the corporate environment, our environmental scientists will interpret GHG metrics to create both science-based metrics and a road to carbon net zero,” Jonathon Hogg explains.
ESG is here to stay…
With sustainable investments outperforming traditional peer funds by a median of 5% there is clear evidence of environmentally and socially beneficial funds consistently achieving higher public market valuations.
While the appetite for corporate purpose and authenticity at all levels of the financial sector morphs more and more into the Environmental, Social and Governance agenda, few infrastructure partners and cloud service providers in Capital Markets are quite so accomplished as Beeks and IPC at delivering the technology to integrate ESG policy and outcomes into the very fabric and infrastructure of their customers’ operation.
About the partners
Beeks Group is highly experienced and knowledgeable about all the different permutations of private, public and hybrid cloud capabilities, allowing shared resources to be harnessed when needed, ensuring sustainability without compromising performance and security.
IPC leads the industry in regulated trader communications, with its flagship product Connexus Unigy, offering firms a dedicated private cloud version of its holistic platform for mission critical external communications and internal workflows.
Powered by Beeks Connexus Unigy facilitates compliant and regulated comms, enterprise ecosystem integration and high touch and low touch enablement in a managed, fully resilient and secure SaaS solution.
IPC’s network connectivity and business continuity portfolio comprises buy-side firms, sell-side firms, inter-dealer brokers, listed and OTC liquidity venues, trade lifecycle service providers, market data vendors, and clearing/settlement firms, and interconnects more than 7000 capital market participants across 750 cities in over 60 countries.
IPC and Beeks access a growing global network of Equinix data centres allowing direct, secure access to key financial hubs and exchange locations, all with world-class ESG capability as standard.
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