ESG Data Guide 2024

ISS STOXX - Screening & Conteroversies

Data category

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

The data offers solutions for:

  • Environmental impact analysis and insight
  • Investment decisions and portfolio insight
  • Nature-based information
  • Nature-based information: Biodiversity
  • Nature-based information: Land use
  • Nature-based information: Oceans
  • Nature-based information: Water
  • Norms-based screening
  • Reporting: CSRD
  • Reporting: ISSB standards
  • Reporting: Impact
  • Reporting: SEC climate
  • Reporting: TCFD
  • Reporting: TNFD
  • Reporting: UN SDGs
  • Social impact analysis and insight

Who are the data users?

  • Corporates
  • Financial institutions
  • Government
  • Investors
  • Trustees
  • Data is used by a broad range of institutional investors, asset managers, asset owners, fund managers, banks, government institutions, universities and research firms.

Where and how do you source your data?

Data is primarily sourced from publicly available information, including a company’s own disclosure and reporting, proxy statements, reputable news, governmental and international institutions, recognised international or local non-governmental organisations, and non-biased subscription databases such as the CDP.


Norm-Based Research
Through ISS ESG's data mining process, ISS ESG carries out data mining for allegations of corporate involvement in failures to respect international norms and standards through ISS ESG's proprietary ESG Newsroom, which compiles parsed, near-real-time media information from tens of thousands of traditional media, social media, and stakeholder publications globally.

Controversial Weapons Research

ISS ESG conducts a comprehensive, systematic review of open sources such as company publications, contract award notifications by government authorities, military-specialised magazines and publications by research organisations and non-governmental organisations.

Active company and stakeholder dialogues are also a key component of the research process. ISS ESG engages in a fact-finding dialogue with companies as soon as the research is initiated and offers companies an opportunity to review the analysis and submit relevant complementary documentation. This dialogue continues for as long as ISS ESG maintains its assessment on the company. ISS ESG also consults with experts and field specialists (commonly representatives of state institutions, inter-governmental organisations, academia, NGOs) to cross-check information and deepen the understanding of benchmark corporate practices.


Modern Slavery Solution
The Modern Slavery Solution leverages a number of ISS ESG products, including the ESG Corporate Rating and Norm-Based Research. Additionally, the Modern Slavery Solution utilises data from external sources such as the US Department of Labor, and FactSet (location data).

What is the cost for your data offering?

Pricing for this solution is available upon request.

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

Insights from industry specialists. ISS ESG employs a dedicated team of researchers with specialized backgrounds in global norms, controversial weapons, and specialized industries offering insight and dedicated experience on the environmental and social issues identified. 

 

Focus on company and stakeholder engagement. ISS ESG engages in fact-finding dialogue with companies upon initiation of research into a reported allegation. As part of this dialogue, the company is presented with the allegation and offered an opportunity to state its position.

 

Norm-Based Research

·         ISS ESG pioneered the creation of Norm-Based Research, now the basis of one of the most widely used ESG strategies. Clients have access to current and historical Norm-Based Research, as well as a defendable and structured methodology to support investment research and decision making.

·         Dynamic assessments updated as new information becomes available. ISS ESG systematically tracks developments on relevant controversies in the 24-hour news cycle and makes updates to assessments as new information become available and validated.

 

ESG Newsroom

·         Data Model. The ESG Newsroom's strength lies in its data harvesting model which leverages the interaction of AI to screen and pre-filter news articles, and analysts as humans-in-the-loop who vet all filtered news.

·         Data. Analyst validated data is clearly categorized using more than 100 ESG themes related to human rights, labor rights, and environmental and business malpractice.

 

Controversial Weapons

·         Granular flagging and scoring system. Controversial Weapons Research findings are categorized by traffic light signals based on status and level of involvement and verification and given a numeric score to provide additional granularity based on type of activity and ownership.

·         A well-established analysis methodology. Alignment with legal definitions, national requirements and recognized conventions ensures international relevance and supports compliance at a national level. Additionally, ISS ESG’s assessment at the weapons program level and throughout the full lifecycle of such programs ensures exhaustiveness.

 

Energy & Extractives Screening and Sector-Based Screening

·         Comprehensive Coverage. ISS ESG employs an issue-based approach to screening which focuses on the actions of companies across the globe. This approach allows ISS ESG to flag potential scrutinized companies that would not otherwise fall into a defined index and allows for fuller coverage. Additionally, ISS ESG takes into account the relevant activities of – and revenue generated by – direct and indirect subsidiaries.

·         High quality data. ISS ESG’s comprehensive Screening methodology, supported by strict internal quality management systems, is based on recognized value systems that are continuously adapted to the latest developments and insights in the field of sustainability. 

 

Modern Slavery Solution

·         Forward-looking, holistic assessment of vulnerability, performance, disclosure and controversies related to modern slavery.

Most recent significant update:

Q2 2024 

Modern Slavery Solution Enhancement and Portfolio Report launch
In June 2024, ISS ESG has launched a comprehensive Modern Slavery Solution, including a risk assessment of 60,000 issuers and a Modern Slavery Portfolio Report.

 

Energy & Extractives topic expansion: Heat Generation
In May 2024, ISS ESG completed the addition of Heat Generation factors to our Energy & Extractives dataset that can help clients address regulatory requirements that emerge in various jurisdictions, such as the recent addition of heat generation metrics to the EU Taxonomy and EBA Pillar 3, Template 3. Similar to our existing Power Generation factors, Heat Generation provides information on companies that burn fossil fuels to create heat for industrial, residential, and commercial purposes. The data provides a more complete picture of a portfolio’s exposure to carbon emissions and assesses how well individual issuers are transitioning away from fossil fuel technologies to renewable energy solutions. 

 

Q1 2023 

ESG Newsroom launch
ESG Newsroom is an AI-supported news monitoring service that allows users to search, monitor, and filter through thousands of news articles related to ESG themes. ESG news is parsed near real-time media information harvested from tens of thousands of traditional media, social media, and stakeholder publications globally and provided to investors via a searchable news database. ESG Newsroom leverages the seamless interaction of AI and specialized analysts, providing clearly categorized and filtered results. This assists users in identifying trends, reputational risk exposure of portfolio companies, or focusing on specific ESG thematic areas.

Planned future enhancements:

  • Newsroom: Rolling out alerting and filtering capabilities

What trends are you seeing in terms of customer demand?

Screening and Controversies data sees constant demand as it helps investors navigate trending themes linked to global crisis. For example, energy and extractives data as well as weapons data help in assessing the war in Ukraine and the related energy implications on a portfolio.

Contacts

Till Jung
Head of ISS ESG
till.jung@iss-esg.com
+49.89.46.2248162