MSCI ESG Research Launches Tool To Analyze Firms Sustainability Strategy

Amanda Cheesley Deputy Editor 10 February 2023

MSCI ESG Research Launches Tool To Analyze Firms Sustainability Strategy

With new ESG and climate regulations coming out, MSCI Corporate Sustainability Insights gives listed companies access to metrics to set goals, track progress.

MSCI, a provider of support tools and services for the global investment community, has launched the MSCI Corporate Sustainability Insights. It is designed to increase corporate sustainability executives’ understanding of the ESG and climate challenges and opportunities facing their companies.

The launch comes as new regulations – such as the EU’s Sustainable Financial Disclosure Regulation – are introduced to protect investors against so-called “greenwashing” and as they increasingly want ESG criteria to be integrated into their investments. 

The tool gives executives the ability to measure and compare their ESG and climate data with that of their peers and, at the same time, identify potential disclosure gaps through intuitive charts, graphs, and maps, the firm said.

Features of MSCI Corporate Sustainability Insights, managed by MSCI ESG Research LLC, are designed to give companies streamlined insights to support strategic planning and encourage investor engagement. It achieves this through new visualizations of MSCI ESG Research risk and performance data, including a company’s ESG Ratings, ESG Controversies, and Sustainable Development Goals Net Alignment profiles, the firm continued.

It also helps identify potential disclosure gaps in carbon-related commitments through the MSCI Target Explorer tool. It can view climate-related risks and opportunities, and compare them with their industry peers, based on the recommendations from the Task Force on Climate-related Financial Disclosures.

MSCI ESG Research said it has measured and modeled the ESG performance of companies for over 40 years via an extensive collection of publicly reported data and direct engagement with companies. 

The rising importance of ESG for investors and companies in recent years, as well as the higher level of regulatory reporting requirements, has led to greater data disclosure and dissemination from companies themselves to MSCI ESG Research. In 2022, 43 per cent in the MSCI ACWI Investible Market Index interacted directly with MSCI ESG Research, the firm continued. 

As regulators have begun mandating TCFD-aligned rules, more companies are making net-zero pledges and increasing their climate-related data disclosures in step with institutional investors that are moving toward net-zero and other ESG and climate investing goals. 

Beth Byington, global head of corporate ESG and climate solutions at MSCI, said: “The ESG and climate needs of companies have evolved dramatically as new reporting requirements from regulators and institutional investors have emerged in recent years. It is now more important than ever for listed companies to speak a common language with these audiences about financial opportunities and risks associated with subjects like climate change.” 

“MSCI Corporate Sustainability Insights was created to help corporate leaders, such as chief sustainability officers, gain further transparency into their ESG and climate profile. We hope these deeper insights will allow them to take quick, decisive action to meet their unique sustainability goals,” she added.

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