Danish central bank selects MSCI to provide ESG data and screening tool for €57bn fund

Bid by ESG research arm of index giant comes well under budget for Danmarks Nationalbank.

Denmark’s central bank has awarded the ESG research arm of MSCI a contract to provide data and a screening tool for the country’s foreign exchange reserve.

The aim of the screening tool is to help ensure that the assets of the Dkr427 billion (€57 billion; $58 billion) reserve fund are managed in compliance with Danmarks Nationalbank’s ESG guidelines. 

MSCI ESG Research Limited saw off 14 competitors for the tender, worth Dkr2.2 million. The winning bid was substantially lower than the estimate in the tender put out in February, which earmarked Dkr6.1 million for the contract.  

Pricing and the range of ESG data were the joint highest-weighted criteria for bids, at 30 percent.  

A spokesperson for Danmarks Nationalbank declined to name the other bidders for the four-year contract or if the contract is new or a retendering.  

“The contracting authority is with this contract committed to integrating climate-related financial risks into its monitoring and assessment of risks to the financial system and to build capacity around data on ESG factors in companies,” the contract notice stated.  

Danmarks Nationalbank is a member of the central banking climate body the Network for Greening the Financial System (NGFS). Its foreign-exchange reserve is managed passively but is required to comply with ESG guidelines, including exclusions. 

MSCI will provide the bank with a “tool to easily screen its portfolio for compliance” with those guidelines.

It will also allow a “large portfolio of companies” to be assessed on areas such as involvement in controversial weapons; involvement in fossil fuels; greenhouse gas emission intensity, including supply chain emissions (Scope3); alignment with Paris-aligned climate scenarios; and transition risk management.