How does ESG relate to the trading desk?
The industry is currently in the early stages of what will, no doubt, be an iterative process to answer that very question – how does ESG relate to trading and the execution ecosystem? Topics such as the climate impact of trading technology and infrastructure, the use of AI in trading strategies, the sustainability of our trading partners and technology vendors, the diversity of our own teams and the teams we partner with, along with many other significant topics, will form the basis for this important and ongoing conversation.
Initiatives like Sustainable Trading [a non-profit membership network dedicated to transforming ESG practices within the financial markets trading industry] have been created to help facilitate the ongoing dialogue around ESG in trading and help frame industry best practices for integrating and measuring ESG in the execution process.
Introducing an engagement framework at the trading desk level to create practical and measurable ESG best practices will hopefully result in positive change across the industry. Creating broad networks of ESG champions across the trading landscape will only serve to strengthen our collective approach to incorporating ESG and sustainability principles into our trading businesses. As with any similarly dynamic initiative, the ability to be introspective is key. Turning the lens inward to evaluate your own internal practices is often a constructive starting point in the process.
How can firms best navigate changing market structure in the equities market?
Navigating market structure complexities has been a challenge for many of us throughout our careers. The impact of new technologies, new regulations, and expanding numbers and types of venues, all present unique challenges as we strive to optimise execution outcomes in pursuit of greater returns for our clients.
At AllianceBernstein, we’ve always believed that using data to address market structure issues has positively impacted our ability to meet these challenges. The ability to exhaustively measure not only overall execution quality but the impact of different routing strategies or technologies, the contribution of different trading partners or venues – to name just a few – has both positively informed, as well has helped manage, our response to the ever-changing equity market structure landscape.