Overview
MSCI (Morgan Stanley Capital International) is a leading provider of critical decision support tools and services for the global investment community. It offers a broad range of products and services, including indexes, analytics, ESG metrics, and research
Scope & Adoption
MSCI’s ESG research evaluates and rates companies based on their exposure to, and management of, ESG risks and opportunities. With its ESG ratings, MSCI covers over 8,500 global companies and more than 680,000 equity and fixed income securities globally. The widespread adoption of MSCI’s ESG metrics by institutional investors, asset managers, and corporates underline its significance in the investment world.
Why it Matters
For investors:
- Comprehensive insights: MSCI offers a holistic view of companies’ ESG performance, allowing for informed investment decisions
- Risk Mitigation: ESG ratings help investors identify potential risks associated with a company’s ESG practices
- Opportunity Identification: MSCI’s ESG data highlights companies leading in sustainability, offering potential growth opportunities.
For companies:
- Benchmarking: MSCI’s ratings provide companies with a chance to compare their ESG performance against peers
- Risk Management. Granular breakdown of widely reported business and geographic exposure to risks, helping companies identify and address potential vulnerabilities
- Improved Investment Appeal. By demonstrating good ESG practices through high MSCI ESG ratings, companies can attract investments from socially responsible investors.
Scoring & How to report
Companies are assessed based on their management of key ESG issues relative to their industry peers. MSCI uses an ‘AAA’ to ‘CCC’ scale to rate companies, with AAAs defined as industry leaders and CCC as industry laggards.
The ratings process involves data collection across 33 ESG Key Issues, focusing on one’s that are material for a company’s respective industry. Data is gathered from publicly available data (such as annual and sustainability reports) and alternative sources, not including data reported by companies or sourced from external public data sources. Although there is a systematic, ongoing daily monitoring of scores, a company's Industry Adjusted Score and ESG Rating are typically only updated annually.
Alignment with other frameworks
MSCI’s ESG ratings and metrics align with various global standards and frameworks:
- SDGs: MSCI has a feature dedicated to evaluating the degree of alignment between a company’s operations, products and services with each of the 17 SDGs.
- TCFD: MSCI’s tools align with recommendations from the Task Force on Climate-Related Financial Disclosures
MSCI with Nossa Data
Nossa Data supports the MSCI in numerous ways, to help you put your best foot forward for scoring and benchmark to peers.
Start your MSCI Journey with Nossa Data
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