State Street has introduced Carbon Asset Servicing Solution and depositary services to allow asset managers to integrate carbon-related assets into their portfolios.
By using the Carbon Asset Servicing Solution, clients will be able to incorporate carbon assets into both existing ESG and non-ESG portfolios, leveraging State Street’s back and middle-office capabilities.
The solution will provide a range of fund administration and depositary services, including recordkeeping, net asset value calculation, reporting and other oversight functions.
It will also provide data from multiple parties, including top carbon registries, exchanges and cash agents, allowing clients to gain exposure to the growing ESG asset class via spot and derivatives markets.
Phil Kim, global head of ESG Product at State Street, says: “The carbon assets market is growing dramatically — as the total traded value for compliance and voluntary credits reached a record €865 billion in 2022 and is expected to grow fifteen-fold by 2030 as new regulations in major regions push corporations globally to report on and offset their greenhouse gas emissions.”
“Our new carbon asset servicing solution will help clients gain access to this emerging asset class so they can directly hold carbon allowances and credits and trade them as they would other products, ultimately looking to maximise the potential of their investment portfolios using State Street’s fund administration expertise.”
