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New S&P Ratings Evaluation tests companies' ESG & future viability

  • Apr 15, 2019

As the importance of ESG grows rapidly within the financial sector, S&P Global Ratings has launched an in-depth ESG evaluation system that provides a full breakdown analysis of how a corporation or organisation will be able to function successfully in a future where sustainability will be a key performance indicator.

The ESG rating is separate from traditional credit ratings and entities will be able to use S&P's evaluation via a detailed questionnaire, combined with S&P's extensive database, to assess a firm's or organisation's ability to prepare for and adapt to future risks and take advantage of opportunities.

Michael Wilkins, managing director and head of sustainable finance at S&P Global Ratings, said, "Leveraging our global analysts' knowledge of companies and sectors, the S&P Global Ratings ESG Evaluation takes a broad view of the impact of a company's ESG exposures on its future sustainability."

Currently, the ESG Evaluation is available to companies and organisations in the corporate, infrastructure sectors, and certain public finance areas, such as transportation and energy, in the US and globally. Over the course of 2019, S&P Global Ratings is scheduled to introduce ESG evaluations for banks, asset managers, multilateral institutions, public agencies, utilities, and later will include insurance, public housing and the education sector.

John Berisford, president of S&P Global Ratings explained, saying, "The ESG Evaluation was developed in response to demand from investors and companies seeking in-depth sector and company analysis on an increasingly important metric: the durability of an entity's environmental, social and governance practices."

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