Resource Center

In 10 for 2018, we focus on the ESG issues we anticipate could pose significant risks for investors. The ESG issues in focus fall into four broad themes: water management, climate change, consumer protection and stakeholder governance. Learn more about the stories behind these issues below.

Econopolis combines financial analysis with its qualitative evaluation of management and macro-economic themes to construct a portfolio that it believes will be competitive and sustainable in the long term. Their qualitative approach to ESG presented them with two challenges: How can they measure their ESG performance against that of other leading responsible investors? And, how can they reassure clients that their approach is credible?

Sustainalytics hosted an online panel discussion about recent trends, company engagement and developments in modern slavery, along with a preview of Sustainalytics’ thematic engagement on modern slavery.

Given this context, Sustainalytics believes now is the right time for the European Commission to look at ways to strengthen the quality of corporate ESG reporting and disclosure, and encourage greater transparency regarding the processes ESG research and ratings agencies have in place to arrive at company-level ESG ratings. To ensure our views are heard, herein Sustainalytics provides our perspectives with respect to corporate disclosure, insights into our research processes, and how we believe the European Commission can help to strengthen the practice of sustainable investing.

An increasing number of financial institutions integrate sustainability considerations such as environment, social and governance factors into their investment decisions and product development. Increased customer awareness, regulations, and growing evidence of the long-term benefits of considering sustainability in investment decisions has led to a significant growth in the sustainable finance field.

Placing its clients’ interests centre stage, ABN AMRO understands the importance of delivering optimum service and offering transparent and simple products, while remaining at the forefront of technological developments and innovative solutions for client convenience. As part of its fiduciary duty and as a bank that commits to the United Nations-supported Principles for Responsible Investment, ABN AMRO has a detailed plan for ESG integration, engagement and sustainable investing.

Our experts will assess the ESG impact of a company’s activities and products, including corporate social responsibility programs, supply chain spending, and operations.

Cleaner shipping has been a trending topic particularly since the International Maritime Organization (IMO) declared that 2020 will mark the “beginning of a decade of action and delivery” for the shipping industry.[i] A key approach to cleaner shipping is for companies to renew their fleet with more environmental-friendly vessels. However, this approach triggers an obsolescence of older vessels and increases shipbreaking activity. In Sustainalytics’ 10 for 2020 report, we mention the issue of shipping practices with large environmental impacts including shipbreaking practices which we will explore more in depth in this article.

Download our Sustainability-Linked Bonds Methodology backgrounder to understand our approach to assess alignment with the Sustainability-Linked Bond Principles (SLBP).

In this video, Lili Hocke, Sustainable Finance Solutions Product Manager, explains in detail the methodology behind our Second-Party Opinion approach on Sustainability-Linked Bonds (SLBs).

In November 2019, as part of the Sustainable Seafood Engagement, Sustainalytics visited Chile to learn more about the country’s rapidly growing aquaculture industry. Commercial salmon farming has developed quickly in Chile over the past two decades, and today the country is the second largest producer of seafood in the world. Although salmon is not a native species to Chile, the climate in the southern part of the country (zones 10 and 11) offers excellent conditions for farming activities. Farmed salmon now represents the country’s second largest export and the industry provides thousands of jobs for people living in some of Chile’s most remote communities.[i] Despite this economic success story, the industry also faces environmental and social challenges which may cause investor risk. These risks may become more pronounced in the future, as the sector now looks to expand deeper into biodiversity hotspots.

In this year’s edition of our 10 for series, we put an environmental, social and governance (ESG) lens on 10 investment themes that may offer investors an opportunity to create a positive social and environmental impact through the equity market. The trends we identify are driven by corporate initiatives to scale new technologies, improve social conditions, conserve ecosystems and mitigate climate change.

Review the second-party opinions for some of the green, social and sustainability bonds mentioned in our 500th SPO post. Learn more about the issuers, and the socially and environmentally focused projects and initiatives their bonds funded.

As the largest second-party opinion provider, Sustainalytics works with hundreds of the world’s leading issuers and investment banks to help them bring credible sustainability bonds and loans to market.

Climate bonds, loans or debt instruments are used to finance or re-finance projects that address climate change and are in line with achieving the goals of the Paris Climate Agreement. Such projects include wind farms, solar plants, sustainable buildings, etc. and can be found in a multitude of sectors including shipping, agriculture, energy or forestry amongst others.

Climate risk management is one of the overarching challenges facing members of society, including investors. Investors are striving to understand and integrate the financial impact of climate-related risks and opportunities in investment decisions.

This thematic engagement is aimed at encouraging companies to define meaningful SDG strategies that align with their business plans. It aims to influence them to address their negative impacts and seek out opportunities to produce positive outcomes in line with the 2030 SDG agenda, while contributing to a more stable long-term operating environment for themselves.

An SPO provides potential investors with assurance that the use of proceeds for the bond or loan, as set out in the framework, are aligned to market practices.

Sustainalytics’ Carbon Risk Rating assesses the degree to which company value is at risk, driven by the transition to a low-carbon economy. Specifically, the Carbon Risk Rating measures a company’s unmanaged exposure to carbon risk.

The Country Risk Ratings measure the risk to a country’s long-term prosperity and economic development by assessing how sustainably it is managing its wealth. It can be used to support country assessments and help investors anticipate and manage emerging risks with an analysis of events happening in a country