What new scenarios are reshaping the market, particularly the one in which ARCA Funds operates?

“The pandemic has generated new challenges and accelerated trends that have been in place for some time: technology and sustainability are and will be increasingly prominent, including in Italy.

Let’s start with technology.
Let me preface this by saying that one of the characteristics that makes Arca Fondi SGR one of the leading players in the field of asset management in Italy is its capillarity throughout the territory: we have about 100 placement entities operating with more than 8,000 branches and a network of financial promoters and online channels.
The impact of the pandemic in the service sector, such as ours, is forcing a complete rethinking of how we interact and provide information: here digital technology is of fundamental importance, but we need to know how to use it in the most timely and effective way possible.
In 2020, for example, we have enriched the digital platform and service offerings by conducting more than 200 webinars for our consultants to front the 8 in 2019: it was very important to have experimented with this type of interaction last year, so that we are ready to react in a timely manner with its more massive use.

But the potential of technology embraces more strategic issues such as the value-proposition: The critical success factor today lies in the ability to understand customer needs and to offer products and services that meet those needs.
An ability that can be acquired by adopting logics that transform every enterprise into a data-company.
With this in mind, in Arca Fondi we have created an in-house Innovaction Lab to serve the entire company, with the goal of processing and managing big data, analyzing it, and using the results of these analyses to find customized answers to customers’ needs.

Today the technology platform developed by our Arca Innovaction Lab is the beating heart of the business, providing input to all other divisions through the use of sophisticated data and analysis tools.
Before the transformation, every area of the company-from managers to sales, through back office and IT-used and processed information in a non-aggregated way.

We decided to pool all this data, creating a single integrated system that connects with the different interfaces: the app and site for clients, the software used by the managers and the portal for placement assistance to the sales network.
This platform makes it possible to prepare differentiated reporting in favor of customers, to carry out any ad hoc marketing campaigns, in synergy with the Banks and their advisors, according to age, geography, risk profile and type of customer, but it is also useful for the development of new products: through the data we are able to build a given portfolio with a certain expected return; we can test it and know how it will behave if negative phases similar to those observed in past circumstances occur in the market.

Our analysis tools also allow us to build proprietary forms with reference to ESG sustainability metrics, right down to establishing the social impact, social governance and environmental impacts of funds, for example by measuring the carbon footprint, literally “carbon footprint,” the parameter that is used to estimate the greenhouse gas emissions caused by a product, service or organization, usually expressed in tons of Co2 equivalent.”Does sustainability matter today?

“More than important, it plays a key role.At Arca Fondi SGR we are convinced that development cannot be separated from sustainable and responsible investment that considers not only financial factors, but also theESG instances: environment, society, and governance.
Savers are increasingly sensitive to the environment and secondarily to society, butgood governance is indispensable to create value in the long run and to acquire results in the other two areas of the ESG sphere.
In summary, a sustainable business provides greater visibility into the prospects for profitability in the medium and long term, because the integration of financial analysis and ESG parameters is a non-financial risk management tool that enables the selection of companies best prepared for future challenges.

That is why we have developed a proprietary ESG Rating for choosing the securities that are best suited for inclusion in its ESG Funds based on a quantitative approach that covers almost all the assets in its managed funds: it is a synthetic indicator organized into seven rating categories, on a scale ranging from CCC to AAA.
The rating assignment to the individual financial asset is based on information provided by leading data providers and international institutions such as the United Nations.
In the rating process we also take into account so-called controversies, that is, more recent events that are not yet considered in the standard rating criteria.
In 2020 we also launched a range of ESG funds, including the innovative Arca Sustainable Opportunities family of ‘window’ products and the Arca Green Leaders Fund, which makes portfolio flexibility and a focus on environmental issues a real flagship.
The range of ESG Funds is set to grow over time, and two new equity funds, Arca ESG Leaders America and Arca ESG Leaders Far East, will already be introduced shortly, covering geographic areas traditionally underrepresented in sustainable and responsible products.

Another example is our Pension Fund, which boasts 180,000 members and meets ESG criteria; from next year it will go to invest in a student housing fund, among others, demonstrating the importance we give to the social aspect.”

What are the values of ARCA Fondi SGR and how do you articulate them?

“All of our activities are declined through our values: trust between the company, business partners and savers; the integrity we employ in building relationships with clients and in asset management; and respect for the needs of those entering – perhaps for the first time – the asset management market.

These are the values that have inspired the work of our company, Italyindependent leader in savings management, for 35 years.

In addition, ideas and creativity of our employees are the values of those who, like us, with solidity and reliability, can boast capital of about 32 billion euros with more than 750 thousand subscribers.

At Arca, we are convinced that, even through savings, we can positively affect the environment and society in which we live and build a more sustainable future together.That is why in 2019 we signed up to the United Nations Principles for Sustainable Investment (UNPRI), and with this in mind, we decided to enclose our historic logo in a circle, an eternal symbol of perfection, made up of seventeen different colors corresponding to the 17 Sustainable Development Goals of the United Nations 2030 Agenda.

Thus, there are four areas in which we decline our values:
– A commitment to achieve results that are in line with sustainability characteristics;

– Increasing the inclusion of ESG criteria in our Funds, as in the case of our proprietary ESG rating;

– The path of improving the social factors within us;

– support to nonprofit organizations for the material assistance of the terminally ill, such as the one we have been giving to Vidas for many years with the involvement of employees and customers, to more recent projects to zero plastic use and minimize waste.”