How do MSCI ESG Ratings work?

What do MSCI ESG Ratings measure?

Our ESG Ratings are designed to measure companies’ resilience to financially relevant, industry-specific sustainability risks and opportunities.

We use a rules-based methodology to identify industry leaders and laggards, assigning each company an industry-relative letter rating from AAA to CCC based on how well they manage these risks and opportunities relative to peers.


ESG Ratings video

0 seconds of 0 secondsVolume 90%
Press shift question mark to access a list of keyboard shortcuts
00:00
00:00
00:00
 

How MSCI’s ESG Ratings work

Learn more about how you can use our ratings to integrate financially relevant, industry-specific risks into your investment decision-making.

Download Transcript (PDF, 120 KB) (opens in a new tab)

ESG rating Key benefits

How investors use MSCI ESG Ratings

Pension funds, sovereign wealth funds, endowments and asset managers use our ratings as part of their investment processes for an informed understanding of risk and returns. Our ratings provide insight into how companies within a given industry compare with one another based on their exposure to, and management of, financially relevant, sustainability-related risks.

 

Manage risk

Monitor portfolio exposures to sustainability-related risks.
 

Construct portfolios

Integrate financially relevant, industry-specific sustainability-related risks into portfolio construction.
 

Sharpen insight

Get support for your fundamental research.
 

Enhance engagement

Identify leaders and laggards in each industry and monitor progress.
 

Benchmark performance

Compare performance on financially relevant, industry-specific sustainability issues.
 

Inform reporting

Report on mandatory disclosures and update clients and other stakeholders on progress.

See financial - ESG Ratings

See financial significance

Our ratings support the construction of portfolios designed to enhance long-term risk-adjusted returns.

  • Breadth and depth

    Our ESG Ratings cover more than 17,000 issuers and 999,000 securities worldwide.1

  • Industry-specific

    We continuously monitor emerging risks and opportunities, focusing on issues most relevant to a company’s core business based on its industry.

  • Alternative data

    To uncover risks and opportunities, we augment corporate disclosure with alternative data to go beyond what traditional financial analysis can capture.

  • Tech-enabled insights

    We leverage technology throughout our data creation process to provide scale, speed and differentiated data.

  • Continuous innovation

    Ongoing client feedback, monitoring of emerging sustainability issues, and assessing new technologies and datasets enhance our methodology and coverage.

  • A record of leadership

    MSCI has assessed sustainability risks based on industry financial materiality since 1999 with the establishment of MSCI ESG Ratings.2


ESG Ratings Related Content

ESG ratings footnotes

1 As of June 30, 2024.

2 Through our legacy companies KLD, Innovest, IRRC and GMI Ratings. Origins of MSCI ESG Ratings established in 1999. Produced time series data since 2007.