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Unraveling the variety of risks associated with company ESG issues has never been more important in the context of our current market environment. Material ESG issues are the central building block of Sustainalytics’ ESG Risk Ratings. Underpinning our 20 material ESG issues are more than 250 ESG indicators, which enable investors to understand how exposed companies are to specific issues and how well companies are managing these issues.

Spotlight on Sustainalytics’ 20 Material ESG Issues

Over the next several months, Sustainalytics will highlight the importance of a specific material ESG issue in the context of current market conditions, provide rich analysis on each issue and focus on companies that perform well.

Explore All Material ESG Issues

Community Relations

7

Community Relations

Community Relations – examines how companies engage with local communities (including Indigenous peoples) through community involvement, community development and/or measures to reduce negative impacts on local communities.

Carbon - Products and Services

10

Carbon – Products and Services

Carbon – Products and Services – evaluates a company’s management of the energy efficiency and/or greenhouse gas emissions of its services and products during the use phase.

Bribery and corruption

5

Bribery and Corruption

Bribery and Corruption - focuses on the management of risks related to alleged or actual illicit payments, such as kickbacks, bribes and facilitation payments to government officers, suppliers or other business partners, as well as the receipt of those payments from suppliers or business partners.

Emissions, Effluents and Waste

8

Emissions, Effluents and Waste

Emissions, Effluents and Waste – assesses the management of emissions and releases from a company’s own operations to air, water and land, excluding greenhouse gas emissions.

Product Governance

17

Product Governance

Product Governance – looks at how companies manage their responsibilities vis-à-vis clients (quality and/or safety of their products and services). This issue puts an emphasis on quality management systems, marketing practices, fair billing and post-sales responsibility.

Access to basic services

6

Access to Basic Services

Access to Basic Services – focuses on the management of access to essential products or service such as healthcare services and products to disadvantaged communities or groups.

Human Capital

12

Human Capital

Human Capital – assesses the management of human resources. It includes the management of risks related to scarcity of skilled labor through retention and recruitment programs and includes career development measures such as training programs. Additionally, it includes labor relations issues, such as the management of freedom of association and non-discrimination, as well as working hours and minimum wages.

Resilience

18

Resilience

Resilience – focuses on the financial stability and the management of related risks in the financial services industry, with a concentration on compliance with capital requirements.