MSCI Inc. (NYSE: MSCI), a leading provider of investment decision support tools, announced today that it has signed an agreement with Local Government Super (LGS) in Australia to provide MSCI ESG IVA and Impact Monitor research as well as customized reports to measure and monitor ESG and carbon characteristics of its portfolios. LGS manages around AUD 6 billion in retirement savings for current and former local government employees across New South Wales, including approximately AUD 3.3bn invested in responsible investment strategies.
MSCI ESG Research tools support the integration of environmental, social, and governance (ESG) factors into the investment process and facilitate the implementation of the UN Principles of Responsible Investment (UN PRI). The customized reports will allow LGS to measure and monitor its exposure to ESG risks and opportunities at the individual stock and manager levels. They also analyze the ESG characteristics of portfolios relative to MSCI ESG and non-ESG indices and measure the relative ESG exposure by sector and key ESG risks such as water, carbon, health and safety, and supply chain.
In addition, MSCI ESG Research will use its Carbon Beta product to assess each LGS portfolio in comparison to relevant benchmarks. These reports will measure each portfolio’s carbon intensity, carbon risk, and exposure to strategic opportunities related to climate change.
Peter Lambert, CEO at LGS, said, “Local Government Super believes that a well-developed responsible investment strategy can both assist in generating long-term risk-controlled investment returns, while also aligning ourselves with our members' environmental and social concerns. The implementation of the new Carbon Emissions and ESG reporting capability will enable us to better analyze and communicate our responsible investment outcomes to members and the Board, and maintain leadership in this area.”
Remy Briand, Managing Director at MSCI and Global Head of Index and ESG Research, added, “We are delighted to be working with LGS to provide them with the tools they need to assess ESG and Carbon Emissions exposure across their portfolios. The customized portfolio reports fill a current market gap as, for the first time, institutional investors will be able to regularly measure and monitor the aggregate ESG exposure of a portfolio and compare that exposure to a benchmark ESG index.”