ISS ESG - Climate Voting Policy

Data category

Proxy Voting Policy

What data do you provide?

ISS offers a climate-specific specialty proxy voting policy that focuses on promoting positive climate performance, management and disclosure. Driven by ISS ESG’s leading, in-house Climate, ESG Ratings and Norm-Based Research solutions, the new Climate Voting Policy provides an actionable, transparent framework for investors to exercise their voting rights with reference to their portfolio companies’ climate disclosures and performance.

The Climate Voting Policy is based on principles developed from widely recognized international frameworks, such as the Taskforce for Climate-related Financial Disclosure (“TCFD”), to provide investors with an informed, consistent, climate-related voting approach. The policy uses a scorecard approach reflecting varied climate-related risk factors, resulting in insightful research and vote recommendations.

The Climate policy incorporates a detailed analysis of climate related topics under five key topical pillars:

  • Sector-specific materiality following the ISS Carbon Risk classification assessing industry-specific risks and mitigation strategies.
  • Disclosure signals featuring over 200 climate disclosure indicators, aligned with TCFD disclosure requirements.
  • Norms violations based on violations of globally recognized climate norms.
  • Current climate performance signals such as GHG emission intensity, following the GHG protocol’s carbon accounting methodology for scope 1-3 GHG emissions.
  • Future climate performance signals based on ISS ESG’s Carbon Risk Rating, evaluating the future evolution of issuers’ carbon emissions and how the company tackles climate change along the value chain 

When called for under the policy framework, ISS’ Climate Voting Policy may recommend, for example, adverse votes on the re-election and/or discharge (in applicable markets) of board members responsible for climate-related risk oversight or for failures to sufficiently oversee, manage, or guard against material climate change-related risks, or votes for shareholder proposals with a positive impact on the company’s climate change performance or disclosure.

Where and how do you source your data?

Voting recommendations are driven by ISS ESG’s in-house Climate, Ratings and Norm-Based Research solutions. Data is collected based on the sources and methodology used by each ISS ESG solution. ISS ESG data is typically derived from company filings, as well as ongoing event-driven data updates as reflected in public disclosure, press releases and company web sites.  

The specialty Climate Voting Policy guidelines are publicly available on ISS’s website and can be found here.

Who are the data users?

Data is used by a broad range of institutional investors, asset managers, asset owners, fund managers, banks, government institutions, universities and research firms.

What is the cost for your data offering?

Pricing is based on the method by which data is delivered.  ISS ESG can provide data via its proprietary platform, DataDesk, or via data feed. Pricing for this solution is available upon request. 

What are the key attributes that differentiates the data you offer?

  • Leverages leading in-house ESG data solutions. ISS ESG’s extensive and unique climate data and proprietary research along with issue expertise is used to provide a model for assessment of a company’s climate-related performance and disclosures that, in turn, is used to inform climate-based proxy voting recommendations for subscribing clients.
  • Holistic view of climate impact. The Climate Voting Policy includes a view on a company’s GHG emissions, its climate strategy, and the impact of its activities on climate, putting these into context within its sector and incident-based climate risk exposure. The Climate Voting Policy can be part of a climate-concerned investor’s toolbox and can complement shareholder engagement and other initiatives.
  • Robust and transparent scorecard approach. Policy framework relies on a scorecard approach, reflecting varied climate-related risk factors to produce insightful research and subsequent vote recommendations. Scorecard results build year-on-year enabling evaluation of company performance over time.
  • International expertise and local support. Exceptional client service is a hallmark of the ISS business model with local research, consultants and operational support represented in a dedicated service team. The client support team builds the bridge for clients to the highly experienced team of analysts to help ensure that clients are supported by knowledgeable, skilled professionals to support business objectives.
  • An integrated environmental, social and governance solution. The service combination of the various governance and responsible investment related services offered by ISS allows investors to address ESG challenges with one common approach and rely on global account management and research teams able to offer coherent and unified answers and solutions to their ESG needs. ISS ESG is a true one-stop shop, able to support investors across all ESG related topics.
  • Workflow benefits from technological innovation. Voting recommendations delivered through ISS’ industry-leading ProxyExchange voting and workflow platform, which provides a wealth of powerful tools which enable more intelligent workflows for clients while setting the standard for transparency in the industry.

Tweet

@ISSESG’s Climate Voting Policy provides #investors with a high-quality solution to apply a consistent #climate-focused lens to inform their voting decisions. Learn more about the Climate Voting Policy guidelines and updates: https://www.issgovernance.com/policy-gateway/voting-policies/

Contacts

Maximilian.Horster@iss-esg.com

Corporate Statements

Turning knowledge into action

Maximilian Horster, head of ISS ESG, foresees several trends will shape the environmental, social and governance (ESG) investment space over the next 12 months. Environmental Finance spoke with him to see how ISS ESG is tailoring its data, index and reporting solutions as a result

Guide entries

Bespoke Research & Advisory Solutions

Carbon & Climate Data

Carbon Footprint Report

Carbon Risk Rating

Climate Advisory Services

Climate Impact Report

Climate Voting Policy

Climetrics

Controversial Weapons Research

Country Controversy Assessment

Custom Climate Voting Factors

Custom Rating

Director and Board Data

Energy & Extractives Screening

Environmental & Social Disclosure QualityScore

ESG Corporate Rating

ESG Country Rating

ESG Fund Rating

ESG Index Solutions

ESG Portfolio Analysis

ESG Raw Data

ESG Scorecard

EU Taxonomy Alignment Solution

EVA

Executive Compensation Data & Profiles

Global Sanctions Screening

Governance QualityScore

Norm-Based Research

Pooled Engagement

Potential Avoided Emissions Data

Responsible Investment Policy Development

SDG Impact Rating

SDG Solutions Assessment

Second Party Opinion

Sector-Based Screening

SFDR Principle Adverse Impacts Solution

Shareholder Meeting Results

Stewardship Toolkit