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MSCI launches public tool to help corporates and industry stakeholders understand its ESG Ratings model

Nov 16, 2020 at 9:07 AM EST
  • The new MSCI ESG Industry Materiality Map explores ESG risks by industry and demonstrates how various ESG Risk exposures factor into companies’ ESG Ratings
  • The Map reflects the latest ESG Ratings model enhancements and follows the launch of three additional public search tools over the last 12 months to provide transparency into fund, index and company ESG performance

NEW YORK--(BUSINESS WIRE)--Nov. 16, 2020-- MSCI Inc. (NYSE: MSCI), a leading provider of critical decision support tools and services for the global investment community, today launched the MSCI ESG Industry Materiality Map, a public tool which explores the key Environmental, Social and Governance (ESG) Issues by GICS®1 sub-industry or sector and their contribution to companies’ overall ESG Ratings.

The map is a continuation of MSCI’s mission to increase transparency and educate companies, investors and industry stakeholders of the value of ESG data and ratings. The educational tool provides a window into the dynamic and industry-specific MSCI ESG Rating model and allows users to delve into key E, S and G issues that impact different industries. It follows the launch of three public search tools over the last 12 months that provide public access to fund, index and company ESG and climate characteristics.

The Materiality Map also showcases some recent ESG Ratings model enhancements, which include a heightened focus on corporate behaviours, such as fraud and anti-competitiveness practices, across all sectors, assigning greater weight to governance, alongside environmental and social considerations. The updates take into consideration input from some of the world’s largest institutional investors as part of MSCI ESG Research’s annual Ratings model consultations. Regular model updates play an important role in capturing evolving ESG risks and opportunities. A recent MSCI study found that an industry-specific weighted approach to constructing ESG Ratings, which changed weightings over time, showed the strongest performance over a 13-year period.2

“MSCI is continuously investing to expand and improve our ESG and climate solutions to support the evolving and complex needs of the investment community. Our new public industry Materiality Map underlines our commitment to transparency and our strong belief that we have the most robust models in the market for capturing short and longer term ESG risks that help our clients build better portfolios,” said Linda-Eling Lee, Head of ESG Research at MSCI.

For more information, please visit msci.com.

About MSCI Inc.

MSCI is a leading provider of critical decision support tools and services for the global investment community. With over 45 years of expertise in research, data and technology, we power better investment decisions by enabling clients to understand and analyze key drivers of risk and return and confidently build more effective portfolios. We create industry-leading research-enhanced solutions that clients use to gain insight into and improve transparency across the investment process.

The information contained herein (the “Information”) may not be reproduced or redisseminated in whole or in part without prior written permission from MSCI ESG Research. The Information may not be used to verify or correct other data, to create any derivative works, to create indexes, risk models, or analytics, or in connection with issuing, offering, sponsoring, managing or marketing any securities, portfolios, financial products or other investment vehicles. Historical data and analysis should not be taken as an indication or guarantee of any future performance, analysis, forecast or prediction. MSCI ESG Research is provided by MSCI Inc.’s subsidiary, MSCI ESG Research LLC, a Registered Investment Adviser under the Investment Advisers Act of 1940. MSCI ESG Research materials, including materials utilized in any MSCI ESG Indexes or other products, have not been submitted to, nor received approval from, the United States Securities and Exchange Commission or any other regulatory body. None of the Information or MSCI index or other product or service constitutes an offer to buy or sell, or a promotion or recommendation of, any security, financial instrument or product or trading strategy. Further, none of the Information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. The Information is provided “as is” and the user of the Information assumes the entire risk of any use it may make or permit to be made of the Information. NONE OF MSCI INC. OR ANY OF ITS SUBSIDIARIES OR ITS OR THEIR DIRECT OR INDIRECT SUPPLIERS OR ANY THIRD PARTY INVOLVED IN THE MAKING OR COMPILING OF THE INFORMATION (EACH, AN “INFORMATION PROVIDER”) MAKES ANY WARRANTIES OR REPRESENTATIONS AND, TO THE MAXIMUM EXTENT PERMITTED BY LAW, EACH INFORMATION PROVIDER HEREBY EXPRESSLY DISCLAIMS ALL IMPLIED WARRANTIES, INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. WITHOUT LIMITING ANY OF THE FOREGOING AND TO THE MAXIMUM EXTENT PERMITTED BY LAW, IN NO EVENT SHALL ANY OF THE INFORMATION PROVIDERS HAVE ANY LIABILITY REGARDING ANY OF THE INFORMATION FOR ANY DIRECT, INDIRECT, SPECIAL, PUNITIVE, CONSEQUENTIAL (INCLUDING LOST PROFITS) OR ANY OTHER DAMAGES EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES. The foregoing shall not exclude or limit any liability that may not by applicable law be excluded or limited. Privacy notice: For information about how MSCI ESG Research LLC collects and uses personal data concerning officers and directors, please refer to our Privacy Notice at https://www.msci.com/privacy-pledge.

1 GICS, the global industry classification standard jointly developed by MSCI and S&P Global.

2 Giese G, Nagy Z and Lee L, (2020) Deconstructing ESG Ratings Performance: Risk and Return for E, S and G by Time Horizon, Sector and Weighting

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Source: MSCI Inc.