Corporates leverage ESG Peer Performance Insights as a risk management tool
As the social and economic challenges of 2020 continue to unfold and markets remain in flux, the resilience of Environmental, Social, and Governance (ESG) investing marks a silver lining. In the context of today’s bear market, investors are demonstrating their preference for sustainable funds over traditional ones, with Q1 2020 seeing a global influx of USD 45.6bn, compared to outflows of USD 384.7bn for the overall fund universe. Europe has continued to account for the majority of this inflow into sustainable funds, while the U.S. has picked up pace with a 100% y-o-y increase, the highest regionally. Furthermore, Morningstar reported that 89%, or 51 out of 57, of its sustainable indices outperformed their market peers in Q1 2020. For ESG practitioners, this may not come as a surprise as experience has shown that companies with robust corporate cultures and sustainable business practices are best-positioned for long term resilience and growth, leading to stickiness of ESG investments.
Corporate ESG Ratings in Latin America: Use Cases for Companies and Banks | Webinar
To take advantage of the demand for ESG-related disclosure and communicate their sustainability achievements to internal and external stakeholders, many forward-looking companies are leveraging ESG information in their capital raising activities and marketing efforts.
ESG Risk Ratings and the Corporate Perspective
In this webinar, Sustainalytics’ Sustainable Finance Solutions team shared insights from our recently published Sustainable Finance Guide. They also discussed our ESG Risk Ratings, how it is being utilized for sustainable finance and beyond, and how companies are leveraging their ESG Ratings for capital raising activities, marketing and communications efforts and internal benchmarking processes.
ESG Risk Ratings Licence
An ESG Risk Ratings Licence from Sustainalytics, allows your company to use Sustainalytics’ ESG Risk Rating for various internal and external corporate purposes. As awareness of the materiality of environmental, social and governance (ESG) factors has grown, so too has the demand for new uses of ESG data and information to be disclosed beyond just the investor community.
Introduction to Sustainability-Linked Loans and ESG Ratings
Sustainable finance and green lending are on the rise as more borrowers and lenders recognize the potential benefits of green and sustainability-linked loan products for their businesses. According to the Loan Markets Association (LMA), sustainability linked loans are a "dynamic and innovative product that enables lenders to incentivize improvements in the borrower's sustainability profile.” Sustainability linked loans align the loan terms to the borrower's performance against pre-determined sustainability performance targets such as a company’s ESG rating. Learn more about ESG Ratings
Demystifying Sustainability Linked Loans: Leverage your ESG Rating
While investors are increasingly focused on how their investment decisions impact the environment and key stakeholders, forward-looking lenders also have sustainability at the core of their allocation strategies. As a result, the demand for sustainable finance products has increased in recent years.
Your Company's ESG Ratings: Understanding Sustainalytics Research Process
In September 2018, Sustainalytics announced the launch of its next generation ESG Risk Ratings, which evaluate the degree to which a company's enterprise value is exposed to material ESG issues. Specifically, they measure a company's exposure to industry-specific material ESG risks, and how well that company is managing those risks. Combining the concepts of management and exposure we arrive at an absolute assessment of ESG risk that is comparable across subindustries, sectors, companies and regions.