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Methodology

Through our methodology, we ask the question: to what extent do company actions positively or negatively effect financial, environmental and social returns?

Basics    |    Stakeholders    |    UN Sustainable Development Goals

 
 
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The backbone of Util is our methodology

We believe that to achieve an accurate view of the value a company is creating, all areas in which a company has an impact on people, planet or pocket should be considered.

Since Util was started at the beginning of 2017, we have worked alongside academics and industry professionals to develop a methodology which quantifies both the financial and non-financial value a company creates and destroys, across a wide range of stakeholders that interact with a company on a daily basis. 

By using Util's methodology and metrics, investors and companies can measure and compare the total value they create, broken down by Stakeholder (Employees, Environment, Customers etc.) and UN Sustainable Development Goal. By providing a birds-eye view of company value, our goal is to provide a new set of bottom line metrics, helping investors maximise their financial and non-financial performance.

 
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Holistic Analysis

We look at both financial and non-financial value created and destroyed by companies across eight key stakeholders. 

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Universal Metrics

We only measure things that every company, regardless of size, geography and industry, has exposure to.

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Comparable Metrics

We show returns in numerical, quantified terms. This allows investors to see the overall value their investments are creating, with shareholder returns assessed alongside seven other important stakeholders.

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Customer Focus

We spend a lot of time analysing a company's core purpose - its products and services. We use machine learning and a wide range of data to better understand how products and services benefit or harm customers. 

 
 

We draw from 1000s of data points

We use four main sources of data to arrive at our bottom line metric. 

  • Company disclosure and ESG (Environmental, Social, Governance) data

Company specific data, focusing largely on financial fundamentals, alongside environmental and employee metrics. 

  • External Sources

Where company disclosure fails to provide a complete picture of company performance, we use external data providers to improve the quality of data that feeds into our methodology. 

  • Unique alternative data modelling

We use data science and machine learning across our methodology, including the development of models aimed at aligning a  company's products and services to each of the UN Sustainable Development Goals.

  • Country and Sustainable Development Goal specific data sets

Countries have varying levels of need in different areas. In order to understand how a company impacts its stakeholders in a particular country, we have built  a series of models that help us determine the importance of company actions across countries of operation. 

 

What is 'Annual Value Generated'?

Annual Value Generated is our equivalent of a Profit and Loss statement.

We look at the sum of both the financial and non-financial value a company creates and destroys across eight key stakeholders over a 12-month period. 

We split our analysis into eight key stakeholders groups:

  • Shareholders
  • Government
  • Suppliers
  • Creditors
  • Environment
  • Employees
  • Customers
  • Community

Companies have extensive and complex effects on a wide range of stakeholders; Util's methodology analyses a wide range of these stakeholders to provide an accurate view of company performance.

 

UN Sustainable Development Goal aligned

 
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What are the UN Sustainable Development Goals?

The UN Sustainable Development Goals are a set of 17 global goals released in 2015 as the follow up to the UN Millennium Development Goals. A deadline of 2030 has been set by the UN to achieve the goals, and estimates suggest it will take investments of between 5 and 7 trillion dollars per year to meet the target.

The 17 goals define the biggest problems facing the world today: our mission is to direct investments into companies that positively contribute to the achievement of them.

 

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How does our methodology align to the SDGs?

We align value created and destroyed for each of the  eight stakeholder groups to each of the 17 Sustainable Development Goals. This includes using advanced machine learning models to understand how a company's products and services align to each of the Global Goals. 

In doing this, as well as seeing the value created across stakeholders, investors can monitor, compare and maximise the value investments are creating towards each UN Sustainable Development Goal.

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