Episode 3

What does a sustainability data engineer do? With Thibault Twahirwa

Q interviews Thibault - who has held the interesting role of a Sustainability Data Engineer. What does that actually mean ? Listen as they discuss the different types of data that exists in the ESG world, and the process involved in mapping this all together. They discuss some of the shortfalls of data today, such as for private companies and GHG emissions, along with working in a field with purpose. Its a facinating topic, that can go under the radar, but makes up many of the estimates, scores and measures that we use today. Find Thibault on LinkedIn at www.linkedin.com/in/thibault-j-t/


[00:00:00] Qayyum ("Q"): I have to vote here on the Real People Real Impact podcast. I've known you now for a few months. We met when you're working on one of the big banks and you've moved on to one of the largest ESG advisers today. And I feel like we you get to nerd out on ESG data. That's where we got along. And you're a really great individual and you have a very rare title. So you're a sustainability data engineer or EAC data engineer. And you've done this for one of the biggest ESG advisors and one of the biggest banks that are in the US. And I don't think people know that this title exists, but it's going to be even more important going forward. So first of all, I just want to ask you give a little bit of introduction to yourself who you are and what does that role actually look like on a day to day basis?

[00:00:49] Thibault: Yeah. Thanks a lot. It's a real pleasure talking to you. So it's always exciting. Yeah. My name is Tebo, and as you can tell, I have an accent. I was born and raised in a tiny country and stuff with a horrendous. I came in the States, like about ten years ago, and then did school after school, pretty much did science, physics, electrical engineering, and then applied analytics. I find myself in the banking sector coming from there. They have no idea pretty much what a bank is. The bank for me was you save money. Pretty much that's where you put the cash. That's where you draw the cash. But then I got introduced into Wall Street sort of banks. And the area that I went in was specifically data engineering, data and technology aspect. And in that specific group there, what I was doing was kind of the analytics, the analysis and all that. And that's when I found out about in that space and sustainability, kind of picked my eyes for two things. Esg in particular, that's the niche I found that you can be able to kind of generate return for different investors at the same time, you are able to track the impact. Why does that matter to me? I came from East Africa, pretty much, if you think about it, there might be companies that are doing good things there. There might be companies that are doing bad stuff. And this is the opportunity for me that I can use the actual data and then be able to kind of communicate, contribute in that space. And that's why the software was saving to Dashpace. And then again, data engineering is pretty much a growing field. It kind of touches different component. The data analytics is the same thing. So ESG is no different. Even better, ESG is more messy. So the Messier the data, the better job. Yeah.

[00:03:00] Qayyum ("Q"): Messier, the better. And it's really crazy because we share that similarity because I grew up in Kenya. I was born in Vancouver, but grew up in Kenya for about 13 years, both from East Africa. And likewise, I've always felt that with some of these purpose driven sort of ventures and analytics, you just feel like your finance is awesome and you get to do some extra good in the world. How did you transition into finance? What made you make the jump from engineering into banking? Because as you said, banks look totally different today than before. Right. But what got you to make that move?

[00:03:38] Thibault: Yeah. So I think when I started College, I'm always sort of a curious person. And I go after sort of things that I don't know. And when I was in Undergrad, I was a MAS there. I was studying physics and what was happening there. I started in different Sciences. I wasn't pretty much sure, but I wanted to do research. I wanted to kind of become maybe a PhD teacher in chemistry, because that's what I knew. That's what pretty much was a career that my parents, my teachers, everybody I talked about. But then some of the things that was myself and we got an opportunity pretty much to internal Goldman Sachs. And I didn't know what Gomen sauce was. It was one individual who kind of saw me. It was like, yeah, gomansax, you're hiring people who can do coding, you can do C plus plus coding. I don't tell myself why. Okay, I don't know what it is, but it sounds good and it's in New York. So I'm going to go. So I kind of started interview there. I got into that space, and then as soon as I got there, a new workshop completely open. I was able to go there, still do the coding, still do the data, still learn something. And then at the same time, it was finance, which is completely different to the normal way of thinking about finance. So a couple of years down the road and I ended up going to graduate school. And then this time I had sort of introduced to what it is. The banking is how it operates. I learned how fixed income, equity, what quantities, how do you use the data, how do you do pretty much the research, how do you do the fundamental research and all that was very intrusive to me because in my country, all these structures are not in place. So then that's why I ended up finding myself there. And then when I was Morgan Stanley back then, and I got introduced to the sustainability side of things.

[00:05:36] Qayyum ("Q"): Never looked back. And obviously the trend has been right alongside with you. Right. When you work with sustainability data, what does that actually look like on a day to day basis? Like, what kind of data are you pulling in? And we'll talk about the gaps and some of the issues later. But what kind of data are you looking at as a whole and inputs into what sort of analysis?

[00:05:57] Thibault: Yeah. So I think the data sort of varies. I guess once you come to ESG, people might think some people tend to think it's just like environmental data. We're talking about carbon emissions, GHG emissions.

[00:06:13] Qayyum ("Q"): We all love environmental emissions of all kinds.

[00:06:16] Thibault: Yeah. And then on the other side, there is like social and there's governance is what it is. That different board diversity and composition and all that. But the data that I deal with sort of varies and it depends on what sector kind of a product you're dealing with. It could be sometime the actual sentimental data we're talking about. How is this company being viewed in the news that's pretty much could fit into like controversy style data, right? Yeah. So those kind of data I get to deal with, the other aspect is estimates. Let's say you have a specific company, might be a private company. And if that company, let's say, does not disclose these metrics, but you know, some of their financial metrics, how can you sort of estimate data imputation. So we kind of deal with that. It sort of varies, but it mostly is like around the things like representation, gender diversity and all that. So things have damaged totally.

[00:07:20] Qayyum ("Q"): And it's like this chart one time where it kind of showed how companies scores have changed over time and there's been a huge jump, especially in the last years of companies. Escorts like the environmental scores have increased rapidly. S and G has remained a little bit more constant. But it's kind of like now on the way up. And I feel like that's because we made a huge deal about climate change and all this kind of stuff that was happening. It's obviously happening, but where it became a really big sort of issue for the world. And I'm just curious, from the data, do you think that we've sort of over indexed on climate related data and like we said, we see so much around scope one, two, three missions, and there's so much tracking being done. So do you think the social and governance data is still stepping up, or do you see a bit of a mix in terms of what you can get?

[00:08:12] Thibault: Yeah. For the environment, I think two factors, if you look at Europe, they are pretty much sort of advanced in terms of carbon environment in that aspect, in the regulation, once it comes in place, it kind of sort of enforces that. But once it comes to eg the social aspect, the diversity definition in the United States is totally different to diversity in Rhonda in East Africa, and then so is Europe. That data, I say is still behind. But as company care about issues about representation, this data slowly starts sort of developing both data, I would say still not there yet. Even environmental, there is no damage. But over time, I hope that the social aspect will also get some attention.

[00:09:09] Qayyum ("Q"): Totally. Yeah. And I think it's starting there and I think also the other thing that we're seeing now is the cross comparison data, like, for example, carbon intensity. Right. Being able to compare the carbon intensity as a ratio across all these different companies. So hopefully we're able to get not just the raw metrics, but ways that we can actually compare against everyone. I'll go with estimates for a little bit because we're joking on one of the last calls that we had about the scope one, two and three missions. And tell me about conversations I've had with sustainability consultants where they're estimating these for companies. And those estimates are being used for other people's estimates, which are then being used for other people's estimates. And it's a bit slightly a little bit of a house of cards. But what are some of the, I guess, issues you're seeing in the way that is collected today? What are some things that people might not be aware of with you see data right now?

[00:10:05] Thibault: Yeah. So let's say I want to come to the estimate. That's a good actual question. And then that's actually a big problem, too. There's people that are making decision on these estimates, and they're making big decision when it comes to building index and all that. So you're building an index, but you are using the metric that is one estimated on a specific company that is not updated in quite a I mean, some of them I don't know, the upper frequency of even the biggest vendor out there. So the key question is and the problem that I see is nobody knows how frequent, how recent these data is. Some of these data, if a company take action or if a company want to sort of maybe trick, if I don't know, maybe I haven't seen the case. But if a company had to do that, they will be able to get away with it. Maybe they will be getting caught, maybe even a quarter. But some of these data, you can be able to kind of say 100% when it needs to be updated. When you do estimates like that, that's one of the problems that comes into a picture. You can be able to estimate where the company falls. But I guess it varies on different metrics that people are using. How do you verify that? How do I cross check that? But what I've been doing on one side is whenever you impute the new data, you kind of sort of provide explicit that this is estimated based on that. I guess it goes back to how terms and conditions warranty are you on? How do you disclose all this information? It's a step in the right direction since there's no regulation in place. That kind of lost company. You need to produce that. You need to show this there. And even if you do that, how are you going to be able to get this metric from a private company? So that's a big challenge.

[00:11:54] Qayyum ("Q"): Right. And that's what we talked about last time. Yeah. Private companies is a whole different beast, right.

[00:12:00] Thibault: Yeah.

[00:12:01] Qayyum ("Q"): So talking about that, what is available for private companies today?

[00:12:05] Thibault: I think it depends if you already saw somebody who invested in a company, you actually have a way you can influence to get those metrics. Right. Actually those days. But for the external, if you're not involved in that company whatsoever, there's no way you can disclose that information. I think there is no easy way to find that information. So what is existing right now? If you know a company location, you know a company structure, you know company information as far as like maybe social and diversity, you can get some alternative data. They say, Linden, there's vendors that can actually closely estimate that. But the key question is that estimate, how true are you? That is actually cost to accurate in a sense, unless you go check with the actual companies. Yeah. There is something that is existing. There's always there. The key question is the data. Right. And that's sometimes subjective. But there's no matter that exists on private side. And I think maybe there will be over time, I guess, like if you're an investor, you have access, but if you're not an investor, usually it's definitely hard.

[00:13:15] Qayyum ("Q"): Yeah. And I guess it will be a proactive sort of model to go in and no money. Like there's a bit of a card in the stick. Right. Yeah, that's really interesting. So one thing that happened to me when I got into the ESC space is I got in and I knew about ESG and was interested in the purpose and everything. But when I actually got inside and started meeting different people, that's when I truly understood sort of the different actors and people that are working for a much higher purpose. Right. Is that something that you found as well? And how has your mentality changes you've been involved in the space and met different people? Because of course, anytime in the industry you just organically start to create these networks, these relationships, right?

[00:13:58] Thibault: Yeah, I think so. In terms of I hope I understand a good question. Right. But in terms of purpose, the more that I get into ESG, the more that I find out, actually I can still do what I enjoy, which is data, technology, finance, and still be able to have the same impact, if not even bigger. Why? Because when it comes to data, don't lie. If I'm telling you your company is not diverse, I'm not lying about it. You just go check yourself and you're going to find your company is not diverse. There's no way I can actually be able to kind of lie about it. So what I find out is if somebody who is an investor who is interested in the product X that can also care about ESG, I find that I can help out build a product that's tailored to your needs that is actually either you care about diversity or environment and you're able to touch those points at the same time you get a return on the other side. So I think McConnell in that space is like, I feel like I'm part of that impact in terms of things that I care about, which is like the environment, something that I care about. The diversity part is something that I care about those things being able to kind of use that data and drive, create different products, fix income, product, whatever, that might just touch the space from the investor. That's definitely like a calling for me. And if there is a chance where I can be able to kind of drive the invest to show them the great opportunities, again, from looking at ESG, that's what we're is exciting.

[00:15:45] Qayyum ("Q"): Money and liquidity drives so much. Right. And I think that's been the craziest thing because now with ECF purchasing all the vehicles and trying to implement those EC policies with firms like yourself, it's just all different angles pushing people towards that phrase. And it doesn't need to be a hard thing for them to do. Right. I was on a pound the other day and it's really trying to make sustainability stuff easy. Right. Embedded as part of the existing workflows. That's really cool. So what does the future look like for some of the work that you do? Like, what are some of the trends that you're seeing in the space around either company, reporting their collection, you name it. What does the future look like?

[00:16:25] Thibault: So the future looks like? I think if you have a good picture, I can paint for you, think about if somebody you have an elephant, but you have a lot of blind people. One is touching the mouth of an elephant, the other person is touching different sides of the elephant. Everybody has sort of some pictures of what is it that they are touching. They can just describe in their own way. And that's something to see. Esg in terms of that, I understand ESG needs to look this way from my, which is the blind person who's trying to create a picture and the other side is another blind person who had to create a picture or to say over time, there has not been, I don't know, clarity in terms of like regulations, in terms of frameworks and stuff like that. There's so many frameworks and all that that is existing. What's happening going in the future is you will be able to see if somebody says ESG, then you need to be able to have some sort of frameworks that you're going to deal with it. You cannot simply say, oh, ESG, I'm actually building an ESG product, by the way. This is an environmental friendly investment. You need to add it to some metrics, some sort of discredit to be able to get the investor to do that. What I see over time is maybe a little bit cleaner data, a little bit more regulation in place, a little bit more better disclosures and I guess maybe the maturity of this space over time.

[00:17:48] Qayyum ("Q"): I think cleaner data because I feel like we integrate the size framework as part of our application and I know what size be. They're trying to get to a state where it's machine readable EC reporting. Right. Like just like a ten Q ten K. You report the numbers and the data. You don't have a 900 page PDF document with it. That's what it's been like when we do our TCFD scraping. We are literally going in those reports and taking the data out, right?

[00:18:17] Thibault: Yeah. Definitely.

[00:18:18] Qayyum ("Q"): Cleaner data, I think will go a long way and I think when other people see others doing it, then of course they have to do it as well. Otherwise you become one of the ones.

[00:18:26] Thibault: Yeah.

[00:18:33] Qayyum ("Q"): That'S pretty good. Is there any final thoughts that you have for anyone listening about this space?

[00:18:40] Thibault: For everybody listening who cares about these issues? I would say this is the right time to get into this space and what I can say is that you don't need to know things to the PhD level. I mean, if you're driven by curiosity, you care about the environment or social governance aspect of ESG in general. I would say go for it. It's a great place to be. I'll say it's a place where you're going to have impact. It's a place that is moving fast. I would say it's exciting so there's no better time than now.

[00:19:17] Qayyum ("Q"): I can Echo that 100%.

[00:19:18] Thibault: Okay.

[00:19:19] Qayyum ("Q"): It's been really good to have you on. I think your wealth of wisdom and definitely the purpose aligned with everything. I think hopefully we all get to make the impacts in East Africa that we want to have.

[00:19:29] Thibault: Yes.

[00:19:30] Qayyum ("Q"): If people want to find you, what's the best way for them to get in touch with you? Contact you kind of see where you're at.

[00:19:36] Thibault: Yeah, I think you can link in. I'm pretty active there so I think that's actually the most the best way you can get in touch with me and then I try to be active there, but not as much. But that's the best way also.

[00:19:49] Qayyum ("Q"): Oh, thanks so much. You're a real person. Making some real impact.

[00:19:54] Thibault: Thanks a lot.

[00:19:55] Qayyum ("Q"): You're welcome. Yeah.