FinTech Scotland Celebrates ESG Innovation Success, Paving the Way for Job Creation and Industry Change

FinTech Scotland is excited to announce the winners of the “Shaping the Future of ESG in Financial Services” innovation call. This initiative, launched in June 2024 as part of the Financial Regulation Innovation Lab (FRIL) in collaboration with the University of Strathclyde and the University of Glasgow, aims to tackle critical data and technology challenges to enhance the integration of Environmental, Social, and Governance (ESG) factors in the financial services sector.

Challenge Partners for this initiative included Lloyds Banking Group, Morgan Stanley, Barclays, Phoenix Group, abrdn, HSBC, Virgin Money, EY, Sopra Steria, and Equifax. The participating firms worked collaboratively to identify seven key challenges where innovative solutions could drive meaningful impact.

Twenty fintechs were chosen to advance their solutions in partnership with 10 Industry Challenge Partners and universities. Over a three-month Innovation Process, teams collaborated closely with industry professionals developing and showcasing their innovations in the field of ESG.

Eight winners will receive funding to further develop their proposals. These winners have shown significant promise in tackling the ESG challenges highlighted by the FRIL Industry Challenge Partners. Moving forward, these fintechs will continue to refine their solutions with ongoing support and collaboration with industry and the Financial Regulation Innovation Lab

The winners are as follows:

GAIALENS: Greenwashing Analytics Solution enabling investors to assess the greenwashing risk of funds and companies.

SCOTT LOGIC:  B Corp focussed on addressing data quality and reliability in greenwashing.

SICCAR: Secure solution architecture with a focus on reliability and resilience of ESG data.

ESG 360:  An AI-Driven Platform using existing ESG Reports to produce a gap analysis for regulatory compliance that provides full audit capability.

CIENDOS: Delivering environmental data that underpins financial flows and validates environmental claims.

ESG DISCLOSE: An AI powered platform that offers AI-powered analytics, customised integration, real-time monitoring, and collaborative tools.

VERIFOXX: A data query engine enabling Industry to query the dataset of an investee/ borrower/ asset, to gain visibility on verified financed emissions

TEXPERTAI: An AI and data analytics platform specialising in social sustainability focussing on human capital, rights, and labour standards within the workforce and supply chains.

Nicola Anderson, CEO of FinTech Scotland, commented:

“The response to the ‘Shaping the Future of ESG in Financial Services’ innovation call has been outstanding. The level of engagement from both the fintech community and our Challenge Partners highlights the importance of collaboration in driving meaningful change. We are excited to see how the winning solutions will shape the future of ESG in financial services.”

Tom McFarlane, Partner at EY said: 

“The winners of the Financial Regulation Innovation Lab’s ESG innovation challenge showcases the groundbreaking thinking that is critical to tackling today’s sustainable finance challenges. EY has a long-standing commitment to driving innovation in ESG, and we are proud to support these transformative ideas.”

Pauline Brown, Head of ESG Reporting, Finance at Morgan Stanley said:

“We are proud to support the ESG Innovation Challenge and congratulate the winners for their exceptional contributions. Their innovative solutions have the potential to help advance sustainability within the financial services industry. At Morgan Stanley, we are committed to fostering the kind of forward-thinking that drives meaningful progress in ESG.”

David Anderson, Environment and Climate Lead at Virgin Money said:

“We applaud the winners of FRIL’s ESG innovation call for their groundbreaking solutions, and their work will be instrumental in shaping the future of ESG practices within financial regulation. At Virgin Money, we are committed to supporting innovative approaches that drive environmental and climate sustainability across the industry.”

Jennifer Simpson, Head of Climate & ESG Risk at Lloyds Banking Group said

“We are delighted to have participated in FRIL’s ESG Innovation Challenge and extend our congratulations to the winners for their outstanding contributions. Their innovative solutions will support reshaping the ESG regulatory compliance landscape, promoting robust ESG practices across the industry. At Lloyds Banking Group, we remain committed to Helping Britain Prosper and supporting ESG innovation that tackles pressing challenges, paving the way for a more sustainable and resilient financial system.”

Kal Bukovski, Director of Academia and Research at Sopra Steria said: 

“We are proud to have taken a key challenge sponsor role in FRIL’s ESG Innovation Call and extend our congratulations to the winners for their pioneering solutions. Their work underscores the critical role of digital innovation in driving sustainability across the financial sector. At Sopra Steria, we are committed to fostering technological advancements that not only enhance financial regulation but also contribute to a more sustainable future.”

Richard Nicol, Senior Product Owner at Phoenix Group said:

“We have been impressed by the quality of fintech solutions in FRIL’s ESG innovation call. Their forward-thinking solutions highlight the importance of integrating ESG principles into financial regulation. At Phoenix Group, we are committed to supporting initiatives that drive sustainable change and strengthen the industry’s approach to responsible finance and congratulate all the winners of this call.”

FinTech Scotland, SuperTech (West Midlands), University of Strathclyde and University of Glasgow and eight industry collaborators have recently announced the next innovation challenge from FRIL aimed at enhancing consumer outcomes with technology and data is currently live.

This new challenge involves Industry collaborators from NatWest, Lloyds Banking Group, Equifax, PwC, Barclays, Tesco Bank, Secure Trust Bank and Dudley Building Society. It focusses on Consumer Duty Outcomes. Fintech firms from across the globe are being invited to apply by the 25^th of October. Successful applicants may be eligible for grant awards of up to £50,000 to further develop their solutions. Applications to the challenge are now open and more information can be found here

Led by Innovate UK on behalf of UK Research and Innovation, the pilot Innovation Accelerators programme invested £100m in 26 transformative R&D projects to accelerate the growth of three high-potential innovation clusters – Glasgow City Region, Greater Manchester and West Midlands. This is a new model of R&D decision making that empowers local leaders to harness innovation to drive regional economic growth, help attract private investment and develop future technologies.