Because Matarin integrates ESG factors in our risk and return models directly alongside traditional financial factors, and in the same way, these factors are monitored in a similar way on an on-going basis by the firm's investment team.
The contribution to returns of our return factors are monitored monthly. Risk factors are considered on their impact on stock selection and portfolio construction daily, as portfolios are optimized. All of the ESG factors used in our work are implemented, monitored, and challenged regularly alongside all of the other fundamental investment variables used in our models.
Matarin has implemented an internal, senior level, team approach to the oversight and/or implementation of on-going research on new ESG variables which could, potentially, be used in our work. It is the goal of our investment team to identify and test ideas which could improve the efficacy of our models overall. Finding ESG variables is certainly a part of the research process.