Friday, 5th December 2014
Penny Crossland looks at resources that enable enterprises to invest responsibly by managing risk in the environmental, social and corporate governance (ESG) arena. These sit as a subsector within compliance information and are important tools for corporates with business dealings in high-risk sectors and jurisdictions.
There is plenty of information on sources and workflow tools that help companies manage the ever-changing regulatory and compliance landscape, with FreePint being at the forefront of helping information professionals come to grips with the latest sources available - see the recent FreePint Topic Series: Know Your Customer or last year's Series: Compliance in Context.
However, there is a subsector within compliance information, which receives less coverage and sits in the corporate responsibility and risk management arena.
It covers issues relating to environmental, social and corporate governance (ESG) data, with tools in this area helping enterprises manage their own and their suppliers' reputational risk, thereby becoming more responsible in their business dealings. These types of databases are also referred to as investment decision report tools.
Big Three in ESG
The three big ESG vendors are MSCI, Eiris and RepRisk, with the latter being the subject of a recent FreePint Mini Review.
MSCI is the largest and longest established of the three, having been launched by Morgan Stanley and Capital International in the late 1990s. Listed on the New York Stock Exchange, the firm is mainly known for its indices and portfolio and risk management analytical tools. MSCI's ESG tools are intended to help large enterprises incorporate ESG factors into their investment processes.
Eiris's origins are very different to MSCI's. Headquartered in the UK, it classifies itself as a social enterprise and is owned by a charitable foundation, whose board members are experienced in social and environmental policy work. Eiris provides ratings, toolkits and a news service covering ESG performance for a portfolio of companies
Swiss-based RepRisk's unique selling point is its proprietary RepRisk Index, which quantifies risk exposure to ESG issues currently and over time, by analysing critical and negative news on a wide range of sectors, issues and topics. When I reviewed it I really liked the combination of sophisticated technology and human input, which puts RepRisk far beyond the common or garden aggregators to be found in online news provision, and to my mind provides real value to enterprises with investment portfolios in high-risk jurisdictions and sectors.
RepRisk has a host of interesting features. The Mini Review of RepRisk is now available for those with a FreePint Subscription.
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