FTSE Russell - ESG Ratings

Data category

  • Environmental data
  • Social data
  • Governance data
  • Ratings
  • Indices/Exchange data

What data do you provide?

FTSE Russell has been an innovator in sustainable investment indexes since the launch in 2001 of the FTSE4Good Index Series - one of the longest running global ESG index series

FTSE Russell maintains two core sustainable investment data models:

  1. the ESG Ratings and data model assesses listed companies on their operational ESG risks and performance.
  2. the Green Revenues data model classifies and measures company revenue exposure to products that deliver environmental solutions.

By splitting our data model into these two dimensions users can determine more specifically whether to target ESG issues related to (operational) risk or (product) opportunities.

For ESG indexes, FTSE Russell combines data and expertise to apply ESG and investment thinking to solutions that meets client needs. This includes achieving broad market returns and more precise exposures with improved ESG attributes, integrating ESG into specific factor, smart beta and other selective strategies that align with ESG objectives.

ESG Ratings

 

Where and how do you source your data?

FTSE Russell's ESG Ratings data relies upon publicly disclosed information (see detailed process below). Our primary sources of data are reports and other disclosures from companies. However, we also supplement this data with other sources, such as governments and NGOs.

Data is collected according to the following general process:

  • An analyst collects information using documents made publicly available by the company to determine its operational and geographical exposure;
  • A company’s exposure is cross-referenced with a rules-based methodology to determine the applicability of ESG indicators. An analyst uses publicly available documents to assess a company against applicable indicators;
  • The company is contacted and provided with an opportunity to highlight other public information that the analyst should consider. Where this feedback is found to highlight data that is more relevant to the assessment, this is incorporated by the analyst and the assessment finalized;
  • A rules-based, transparent calculation methodology is used to determine the scores across four levels of data.

The ESG data model is overseen by an independent external committee comprising experts from the investment community, business, NGOs, unions and academia. Companies are researched annually and ESG Ratings are updated on a bi-annual basis in June and November.

Who are the data users?

FTSE Russell’s ESG Ratings data is used primarily by asset managers, asset owners, investment consultants and academic institutions for the purpose of index creation, research analysis and reporting.

 

A subset of FTSE Russell’s ESG Ratings is also used for the Transition Pathway Initiative, a global initiative led by asset owners and supported by asset managers that assesses companies’ preparedness for the transition to a low-carbon economy.

What is the cost for your data offering?

Please contact FTSE Russell for information on licensing our sustainable investment data and indexes.

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

FTSE Russell’s ESG Ratings data has a number of unique benefits, including:

Flexibility and customization

The data model is designed for customization by the user to enable the data to be ‘sliced and diced’ to meet a variety of user needs.

Comprehensiveness

The ESG Ratings can be accessed through the online data model and include over 7,000 securities in 47 Developed and Emerging markets, including the constituents of our flagship global and US equity indexes — FTSE All-World Index and Russell 1000® Index.

Emphasis on materiality

Ratings are calculated using an Exposure-weighted average, meaning that the most material ESG issues are given the most weight when determining a company’s scores.

Precise rules and focus on data

The ESG Ratings and data model has clearly defined rules for assessing and rating companies. The output is a data tool that is quantitative, rather than qualitative company research reports.

Objective and strong governance

The ESG data model is overseen by an independent external committee comprising experts from the investment community, business, NGOs, unions and academia.

Sustainable Development Goals aligned

The ESG Ratings support alignment with the UN Sustainable Development Goals (SDGs). All 17 SDGs are reflected in the 14 Themes under the ESG framework.

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@FTSERussell data and analytics to take ESG from niche to norm. Our ESG Ratings covers thousands of companies across developed and emerging markets globally. Experienced provider of investment data models, ratings, analytics and indexes.

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Contacts

info@ftserussell.com

Corporate Statements

Taking ESG beyond equities

Investors are increasingly looking to apply ESG analysis into asset classes beyond equities and corporate debt – and FTSE Russell is developing the tools to help them do so, says Sylvain Chateau, head of sustainable investment product management at its parent, the London Stock Exchange Group.

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