Individual company scores are then assigned as a percentile rank, ranging from 1 (worst ranked) to 100 (best) on the basis of these KeyMetrics® and then converted to the Red, Yellow or Green flag designation.Ĭompany Reports: In addition to a company's overall risk rating, ESG reports also include an industry rating based on a comparison between the company's risk levels in each ESG component area relative to its industry peers. Further, unlike other models with evenly weighted metrics, we assign context-sensitive relative weightings to our key metrics, based on market, regional, ownership or sector differences.

Specifically, these ratings reflect actual corporate behaviors rather than policies or affirmations of intent to adhere to best ESG practices.

Unlike traditional ESG risk models, MSCI's rating methodology is designed to identify risks most likely to affect equity valuations. The ESG Ratings model is based on a carefully crafted and applied list of KeyMetrics® that result in an overall ESG concern level as expressed by Red (High Concern), Yellow (Average Concern), and Green (Low Concern) flags. These ratings provide an independent assessment of the sustainable investment value of public companies. Environmental, Social, and Governance (ESG) Flags: MSCI Ratings publishes Environmental, Social and Governance (ESG) ratings on over 6,000 companies worldwide.

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