MSCI to make ESG ratings public

The move is part of a campaign to increase ESG transparency

Leading data provider MSCI is to make its ESG Ratings publicly available for the first time.

As part of a campaign to increase ESG transparency and data for investors, MSCI ESG Research will make over 2,800 companies in its flagship global equity index, the MSCI ACWI, accessible via a search tool on its online site.

The move will enable investors, companies and other stakeholders to view each company’s ESG rating and history, benchmark against peers and examine ESG-related issues affecting individual firms.

In addition, MSCI said it plans to make the ESG ratings for 7,500 constituents of MSCI ACWI Investable Markets Index available in 2020.

MSCI ESG Research rates companies on an AAA to CCC scale according to their exposure to ESG risks and how well they manage the risks relative to peers.

The ratings are constructed using 1,000 data points from company disclosures and alternative data sets, across 37 key ESG issues that are reviewed weekly.

Leveraging artificial intelligence and machine learning alongside a 200-plus strong team, the company monitors and updates companies on an ongoing basis to deliver relevant ESG insights.

ESG is increasingly being viewed by global investors as a critical factor for building better portfolios,” Remy Briand, head of ESG at MSCI, said. “We want to encourage open discussion among investors and companies on how to improve sustainability across the board and hope that making the MSCI ESG Ratings available to all will facilitate these discussions.”

MSCI ESG Research will also introduce a batch reporting service designed to make clients’ regular reporting easier and more comprehensive.

This is based on feedback from clients who indicated they want more transparency and intelligence to better enable ESG reporting.