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EU Action Plan SFDR

Momentum Around Principal Adverse Impact Data Remains Strong Despite SFDR Delays

Despite the shifting timelines, we observe that the market momentum around PAIs is not diminishing, quite the contrary. Investors in the scope of the regulation are using the fourth quarter of this year to get acquainted with PAI data and set up their systems. Most investors we speak with want to be prepared in time to be able to monitor PAIs throughout 2022 and adjust their portfolios to boost their PAIs (or rather limit the downside, as these are adverse impact indicators). This means that PAIs may significantly impact stock selection and portfolio construction by fund managers keen to have ‘good’ PAI scores.

energy crisis

What ESG Risks Should Investors Consider During the Energy Crisis?

As world leaders prepare to meet in Glasgow for COP26 to discuss accelerating climate action towards the goals of the Paris Agreement, an emerging energy crisis persists around the world.

SFDR EU taxonomy

SFDR and EU Taxonomy Product Disclosure Rules Finally Released

The publication of these rules marks the end of a prolonged period of uncertainty in the market around final rules and timelines - assuming the RTS will be adopted as-is in a Delegated Act, which turns these rules into regulation. There are several noteworthy aspects to these rules, which we address from our perspective in this article.

biodiversity species

Biodiversity: A Crisis Equaling, Possibly Exceeding, Climate Change

According to the UN’s Convention on Biological Diversity the main drivers of biodiversity loss are habitat loss and degradation, climate change, pollution, over-exploitation, and invasive species. Habitat loss is directly linked to the conversion of natural ecosystems to agricultural lands and unsustainable use of water resources.

European Court of Human Rights

Bringing Investors and Companies Together to Accelerate Human Rights Progress

Human rights issues have been rising on the responsible investment agenda in recent years. The COVID-19 pandemic and the Black Lives Matter movement have provoked even more pointed discourse on the topic. The European Union’s current efforts to introduce rules to hold companies accountable for social and environmental risks in their supply chains further accelerate that ascent. This wave of legal requirements and normative expectations is impacting financial markets worldwide, with responsible business regulations already in place or quickly becoming valid.

water ESG investing

Investing in Water for Positive Impact

With the threats of climate change and the existing inequalities in natural resource access and availability around the world, ensuring an adequate supply of clean water is necessary to ensure the well-being of all people across the world.

Blog | Corporate ESG Benchmark| Sustainalytics

Know Where You Stand With Corporate ESG Benchmarking

In this post we discuss why companies should generate a corporate ESG benchmark against their peers, explain how they can go about this exercise, and highlight how they can use that information to advance and enhance their own corporate ESG initiatives.

Blog | Five Steps for Effectively Reporting on Social Impacts | Sustainalytics

Getting to the S in ESG: Five Steps for Effectively Reporting on Social Impacts

This article covers five essential steps for your organization to consider when reporting on your firm’s social impacts.

hurricane

Impact of Climate Change and Extreme Weather on Essential Services

Utilities have found themselves in the literal and metaphorical eye of the storm over the last year as hurricanes, floods and wildfires of increasing frequency and strength have wreaked damage on their assets. In late August, Storm Ida made landfall in Louisiana, USA and devastated the power grid lines. Entergy, the utility operating in Louisiana, supplying most of New Orleans, restored 90% of the supply only by mid-September, with 87,000 customers still without power.

Blog | Justifying Social Impact Reporting | Sustainalytics

Justifying Social Impact Reporting: Eight Business Cases to Make

This article covers eight business cases to make for social impact reporting so that leaders can make social impact a priority for their ESG strategy.

The circular way forward could be the key to reducing food waste

Indications that a food crisis is imminent are clear. Fundamental changes in the global food system are required to address these challenges. This decade is a watershed moment for urgent efforts to close the loop, and companies and investors can play a pivotal role. Despite being closely connected to issues such as climate change and basic human rights, food waste has attracted comparatively less attention from companies, investors, and other stakeholders.

Responsible Investing

Recent market trends put engagement and voting front and centre for responsible investors

From a market perspective, engagement and voting on governance issues have been used as levers for influence for a long time. On the other hand, environmental and social issues were historically addressed from a values-based perspective or primarily for fact-finding purposes. Today, many responsible investors leverage corporate dialogue as a tool to influence and drive meaningful change and impact

North American Material Risk Engagement Trends: ESG Reporting Frameworks, Emission Reduction Targets and Beyond

There are many factors that rating agencies consider within its overall assessment. For example, ESG rating companies tend to look for at least three years of ESG metrics to determine company trends and long-term ESG targets, goals, and strategies to manage and reduce ESG risks at least five years ahead. Read on to learn about how Sustainalytics' Material Risk Engagement program promotes and protects long-term value by engaging with high-risk companies on financially-material ESG issues. (A North American Snapshot)

Sustainable Finance The View from Down Under

Sustainability-Linked Debt Financing: The View from Down Under

For Australia, a country whose economy is historically rooted in heavy-emitting, hard-to-abate sectors, sustainability-linked debt financing could provide the spark needed to accelerate emission reductions and transition to a low-carbon economy.

ESG Risks of Aging Pipelines for U.S. Energy Infrastructure Investors

Pipelines play a critical role in the U.S energy infrastructure transporting natural gas, crude oil, natural gas liquids, petroleum, and petrochemical products. While these pipelines play a vital role in supporting the U.S economy, investors are increasingly scrutinizing pipeline operators' long-term economic profitability and sustainability practices. A closer look into the status of pipelines reveals a particular issue that investors need to consider.

(Possibly) a little less conversation and (definitely) a little more action, please

This blog originally appeared on GES International’s website and has been republished following Sustainaltyics’ acquisition of the company on 9 January 2019. See the press release for more information.

Moving the Needle: How Loans and Bonds Are Being Tied to Corporate Sustainability Performance

The tide continues to rise for the sustainable debt market, with sustainability-linked debt contributing to its steady growth. In this article we take a closer look at what’s driving market adoption of sustainability-linked debt and the principles and frameworks guiding market participants.

construction industry protocol

ESG Investors Consider Socioeconomic Impacts of COVID-19 in the Construction Industry

The construction industry can have a reputation for workforce insensitivity and is highly vulnerable to economic and social variabilities. The ESG Impacts of COVID-19 drive companies to adapt to significant challenges related to the demand for construction services. This construction sector research snapshot highlights relevant social issues that corporations face due to ripple effects from the pandemic using Sustainalytics’ ESG Risk Ratings and Controversies Research.

Sustainalytics Weighs in on EU Taxonomy’s State of Flux

Delays, Questions and Confusion: Updates on the EU’s Sustainable Finance Disclosure Regulation

In this blog, we look at the delay of the level 2 regulation, some aspects of the Q&A, and the ongoing confusion and divergence around SFDR. We pay special attention to the potential impact of the Principle Adverse Impact indicators, an element of SFDR.

covid-19 vaccine storage dry ice

ESG Risk Exposure from COVID-19 Vaccine Transportation and Distribution

As mass vaccination against the coronavirus started, a key challenge has been to keep millions of doses of vaccines at the right temperature. An increase in temperature inside a truck or aircraft, by half a degree, for half an hour, would reportedly result in a 'defrosted' vaccine which has then to be discarded.