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Moody’s and MSCI join forces to enhance ESG transparency

This collaboration promises to merge MSCI’s ESG data and analytics with Moody’s expertise in credit analysis, offering investors and financial institutions innovative tools to navigate the complexities of ESG risks and opportunities.

  • Editorial Team
  • July 4, 2024
  • 2 minutes

Moody’s Corporation and MSCI Inc. have announced strategic partnership aimed at enhancing transparency and delivering data-driven risk solutions in the realm of Environmental, Social, and Governance (ESG) and sustainability.

This collaboration seeks to integrate MSCI’s robust ESG and climate data, analytics, and research capabilities with Moody’s extensive expertise in credit analysis and risk management.

The partnership seeks to leverage the respective strengths of both companies to bring greater transparency to ESG and sustainability markets, facilitating informed decision-making.

Moody’s will utilise MSCI’s sustainability data and models, including MSCI’s ESG ratings and content, which assess a company’s management of financially relevant ESG risks and opportunities. Over time, Moody’s intends to integrate MSCI’s sustainability content across its offerings for customers in banking, insurance, and corporate sectors.

Rob Fauber, President and CEO of Moody’s, stated: “Moody’s is excited to partner with MSCI, a leader in solutions for the global investment community and a pioneer in ESG and sustainability. This is a real win-win, as Moody’s customers gain access to MSCI’s renowned ESG content and MSCI customers will gain access to Moody’s world-class risk assessment expertise, data, and insights.”

In return, MSCI will gain access to Moody’s Orbis database, which contains firmographic information on over 500 million entities. This will enable MSCI to expand its coverage of private company ESG metrics. Additionally, both companies will explore solutions using Moody’s private company data and credit scoring models to enhance insights into the private credit market.

Henry A. Fernandez, Chairman and CEO of MSCI, highlighted the significance of the partnership, stating, “We are exceptionally pleased to partner with Moody’s to offer MSCI’s ESG and sustainability data to Moody’s broad base of global customers.

“Sustainability remains one of the most important trends reshaping the global investment landscape, and the shift to private assets is another. This agreement will help MSCI expand our private company ESG coverage and deliver enhanced solutions across client segments and asset classes.”

The partnership will not affect Moody’s Ratings. Moody’s will continue to provide transparency on ESG impacts through its Credit Impact Scores and Issuer Profile Scores, and will maintain its sustainable finance offerings.

The financial terms of the deal were not disclosed.