Many big insurance brands and pension fund managers wish to invest in projects that meet modern ESG and Net Zero targets. Compliance is a complex issue, across many different political and geographical regions, so here’s one way of checking if funds meet the current ESG requirements in a particular economic zone or country;
ISS ESG, the sustainable investment arm of ISS STOXX, today announced enhancements to its ESG Fund Rating thematic coverage, including a new Biodiversity Fund Screening dataset, which is being launched in tandem with new fund of funds coverage.
ISS ESG Fund Rating and Fund Screening solutions enable investors to quickly and effectively evaluate the environmental, social and governance fund performance of equity and bond funds globally, in line with key ESG risk and performance metrics. Investors can identify funds that meet clients’ ESG preferences, screen for funds that outperform against specific ESG characteristics such as climate or biodiversity, highlight and communicate a fund’s ESG profile when discussing fund selection options with clients, as well as generating insights that can be used for reporting purposes.
The addition of new biodiversity factors further differentiates ISS ESG’s offering in the market, which provides among the widest range of themes and data factors. This broad coverage of themes, supported by dedicated thematic pages in the ESG Fund Rating report, helps investors meet their varied priorities and various reporting requirements, including the EU Sustainable Finance Disclosure Regulation (SFDR) requiring fund managers to disclose the ESG performance of their funds. Each fund holding’s sustainability performance is evaluated through a double materiality lens, weighing ESG risks, opportunities, and impact along the corporate value chain. The rating is comprised of 2,600 data factors that provide insight into overall fund performance, including both a relative one to five-star rating to easily compare the fund against peers and an absolute zero to 100 ESG Performance Score to quickly measure overall sustainability performance.
“ISS ESG has applied its extensive ESG research and data management expertise to enhance its ESG Fund Rating thematic coverage, developing a broad and deep dataset to help support a wide range of investor use cases,” said Till Jung, Head of ESG Business at ISS STOXX. ISS ESG’s methodology is regularly updated to align with international ESG frameworks and regulations to ensure that the ESG fund ratings remain robust and relevant. “This is especially important with the introduction of ESG regulations in several jurisdictions to standardize disclosures and combat greenwashing,” Jung added.
ISS ESG delivers the enhanced ESG Fund Rating via a broad range of channels that can be customized to suit clients’ needs, including through its proprietary platform DataDesk, data feeds, API, Cloud, as well as via select third-party platforms. With the introduction of the new fund of funds coverage, the total number of funds covered has increased to over 44,000.
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