ESG Data Guide 2023

ISS ESG - Climate Scenario Analysis and Implied Temperature Score

Data category

  • Environmental data
  • Research data

The data offers solutions for:

  • Carbon footprinting
  • Climate scenario analysis
  • Environmental impact analysis and insight
  • Investment decisions and portfolio insight
  • Reporting: CSRD
  • Reporting: Impact
  • Reporting: TCFD

Who are the data users?

  • Corporates
  • Financial institutions
  • Government
  • Investors
  • Trustees
  • Index providers

Brief description of the data offering

ISS ESG offers detailed scenario analyses to enable clients to assess the potential business implications of climate change, as suggested by the  TCFD. Historical emission intensities for the past five years are used to estimate future emission trajectories. The average emission intensities for both direct (scope 1) and indirect (scope 2) emissions are then compared to what is required under three scenarios provided by the IEA in their report World Energy Outlook 2019: Sustainable Development Scenario (SDS), Stated Policy Scenario (STEPS) and the Announced Pledges Scenario (APS). Each scenario expects a certain level of carbon budget and temperature increase in 2050. Company-specific emission trajectories show the expected yearly change in emissions (increase or decrease) until 2050. The calculated trajectory considers historic emissions intensity trend and, if relevant, the company’s science-based targets (SBT) and other corporate targets. If the intensity is in line with, or below the required sector intensity for the SDS, the company is considered aligned. If not, the company is considered unaligned.

Data output can be viewed and analysed at both the portfolio and issuer levels.

  • Portfolio level: In the analysis all the portfolio holdings’ carbon budgets are consolidated into one budget. The alignment is then assessed based on the emissions generated by the holdings compared to the portfolio’s carbon budget.
  • The Temperature Score and Exceed Year display the estimated temperature performance of the portfolio at the end of the analysed period, and the year the emissions of the portfolio exceed the allocated carbon budget.
  • Company level: In this analysis the relationship between an individual company and their carbon budgets is presented. It provides information as to whether a company is aligned or not. The information can also be viewed on a company level over time.

Where and how do you source your data?

For scenario analysis, ISS ESG uses GHG emission data provided by companies in addition to modelled data, plus in-house data on GHG reduction targets complemented by publicly available data from the Science Based Targets Initiative as well as data obtained from the IEA on decarbonisation pathways and market growth projections from well-respected macro-analysis forecast.

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?

  • On-trend analysis evolving with an ever-changing industry

ISS ESG has introduced several updates to its physical and transition risk data solutions including  Value at Risk and Net Zero Solutions.

  • A unique and sophisticated emissions modelling system

ISS ESG utilizes a sophisticated approximation system to estimate emissions, including approximately 800 climate-relevant sector and subsector-specific models, allowing ISS ESG to calculate the GHG emissions of companies based on those criteria that are most relevant to their line of business.

  • Comprehensive Coverage

ISS ESG’s data base of GHG emissions contains more than 35,000 issuers across a range of asset classes as of March 2022, including listed companies and issuers of corporate debt.  

  • Data Quality and Transparency

ISS ESG’s granular emissions modelling system was developed over three years with scientists from ETH Zurich. ISS ESG is committed to applying the highest standards of GHG accounting capabilities with unmatched breadth and depth of investments coverage, verification and approximation. Additionally, ISS ESG helps to ensure transparency by including a trust and quality rating for every data point.

  • Experience

ISS ESG has worked with financial market participants and governments to screen trillions of dollars in assets under management for their climate impact. ISS ESG partners with a wide range of other specialists on a non-exclusive base to complement our research and service with premier market offerings.

  •  Expertise

ISS ESG’s dedicated team of climate specialists are industry leaders on climate change issues. Members of the team have partnered in the 2° Investing Initiative, served as resources at various workgroups on financed emissions including the United Nations Environment Programme Finance Initiative, assisted in the development of ISO standards, and contributed to the works of the TCFD.

Tweet

Through its Climate Scenario Analysis and Implied Temperature Score, @issesg offers detailed scenario analyses to enable clients to assess the potential business implications of climate change. Data output can be viewed and analysed at both the portfolio and issuer levels.

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Contacts

sales@iss-esg.com