UiPath: Driving ESG Success in the Financial Industry Through Automation

Access to accurate data is the backbone of any successful ESG initiative. However, cultivating such data is often easier said than done.

Gavin Mee, Managing Director Northern Europe, UiPath

It is certainly true that in this golden age of digital, financial institutions should be able to benefit from the use of targeted technology, and it is in this area that Gavin Mee believes that the solution is found. In this guest author article for The Fintech Times, Gavin details the benefits of data literacy through the use of software bots.

Gavin, who is the Managing Director of Northern Europe at UiPath, introduces readers to software robots and explains how technology can support environmental, social and governance initiatives in banking and finance.

The growing importance of environmental, social and governance (ESG) efforts is on the minds of many after another year of Covid-19, social inequality and climate change. It’s no different for banking and financial institutions that are facing growing pressure from regulators and shareholder activists to step up their ESG initiatives.

In recent years, the number of companies in the financial sector adopting these initiatives has increased, with 80% of banks having already made commitments. A number of commercial banks, for example, have recently offered Britvic a sustainability-linked credit facility of up to £400 million, on the understanding that they will achieve certain ESG objectives. However, to carry out an ESG program, a large amount of complex data must be collected, processed and reported.

For example, banks engaged in green finance will likely need to track their customers’ field operations, carbon emissions, supply chain activities, and a score of other variables. Similarly, a bank seeking to track its energy consumption would need to perform intensive data collection and analysis across hundreds of sub-entities and sites. This large and complex process lends itself to error and would be carried out more efficiently by software robots.

What is a software robot?

Software robots are essentially digital assistants. Think of them as an extra pair of hands to help with the kind of repetitive, data-intensive tasks that can take up a lot of an employee’s day. Using robotic process automation (RPA) and complementary technologies such as artificial intelligence (AI), these software robots are able to operate a computer as a human would, only virtually and without fatigue.

Once instructed in the correct process, these robots can read, extract and process data as needed, faster and more accurately than a human could. Many organizations around the world have already embraced automation to help them lighten the burden of administrative tasks and, therefore, give their employees more time in the day to focus on value-added activities that require ingenuity. and competence.

How can software robots help with ESG?

Key decision makers in banking and finance are increasingly aware of the importance of software robots to the overall success of ESG. The technology’s ability to sift through large volumes of data, quickly and accurately, makes it ideal for supporting ESG initiatives and compliance in many ways.

For example, in the case of reporting processes for green mortgages, software robots are invaluable. With the growing interest in green mortgages, there is an increasing rate of financial institutions offering lower interest rates or additional principles for lending on green properties. In order to ensure that a property meets the lender’s specifications, documentation must be processed and additional checks are required. The software robots are able to sort through this information and report to their colleagues whether the property meets the required ecological standards.

Elsewhere, software robots are used to strengthen ESG investment strategies to extract information from prospectuses, quarterly and annual reports, third-party analysis and media reports, and consolidate the necessary information into the correct format. . This makes it easier for portfolio managers to make responsible, goal-oriented investment decisions that support their ESG initiatives.

In addition to its reporting capabilities, this technology can also be used to implement changes. For example, a business process management company that provides solutions to the banking and finance industry used software robots to digitize loan documents and manage customer processes. This has strengthened its ESG initiatives by reducing dependence on paper and therefore reducing physical waste. Additionally, a Turkish bank is using technology to process loan repayment deferral requests for customers affected by Covid-19 in line with its social responsibility initiatives.

Additionally, for ESG programs to be successful, auditing is crucial. Automation can also help. With audit teams already overstretched, software robots can help support the load by assisting teams in everything from sampling to monitoring and evaluation activities, moving ESG audit programs forward. successful.

As ESG initiatives vary from company to company, so will the application of software robots. However, despite the specifics, the recurring themes of these programs require huge volumes of data to be processed quickly and accurately. Employees can’t do all this work alone, nor would it be the best use of skills. Software robots, on the other hand, are designed to handle this exact job with ease.

It’s no surprise, then, that technology is proving to be an extremely useful tool in turning ESG goals into impactful realities. As the importance of corporate social responsibility will only grow in the coming years, organizations that now deploy software robots in their processes will be better prepared for new ESG regulations as they emerge.

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