ISS ESG Introduces Regulatory Sustainable Investment Solutions
ISS ESG, Institutional Shareholder Services Inc.'s (ISS) responsible investment arm, recently announced the launch of its Regulatory Sustainable Investment Solution, which will assist global financial market participants in defining their interpretation of sustainable investments and quantifying the percentage of funds, products, and portfolios that meet those criteria. The system allows an investor to customise and optimise their sustainable investing plan while also meeting rapidly changing regulatory reporting requirements around the world.
The solution supports the fulfilment of SFDR responsibilities linked to Article 8 and 9 disclosures for investments within the European Union, as well as assessing and measuring the sustainability of funds and investment products that are not covered by the EU Taxonomy.
The approach also aids governments outside of the European Union, such as the United States, Canada, Hong Kong, Singapore, Taiwan, India, and the Philippines, in developing principles-based disclosure regimes.
It aids in the definition and quantification of the percentage of sustainable investments in an investor's ESG funds and investment products, as directed by relevant evolving regulations, proposals, and internal sustainable investment guidelines, and it also provides disclosure and transparency on sustainable investment strategies, criteria, and implementation.
The Regulatory Sustainable Investment Solution takes four pillars into account for ESG sustainable finance disclosure requirements: financially material ESG risks, contribution to environmental or social objectives, "do no serious harm" and broader adverse impacts, and good governance.
It is supported by a wide range of ISS ESG solutions, including ESG Corporate Rating, SDG Solutions Assessment, SDG Impact Rating, Climate Data, Energy & Extractives Screening, Controversial Weapons, Norm-Based Research, and SFDR PAI.
Till Jung, Managing Director and Global Head of ESG Products at ISS, said:
“The challenge of navigating the complexities of the various emerging ESG disclosure rules and frameworks across the globe has now been made easier by our new solution, which packages together with the most relevant ISS ESG data points for clients into one single dataset, to help address regulatory reporting requirements globally. This toolkit type solution is designed to make client's lives easier, as it facilitates the customization and implementation of an investor’s global sustainable investment strategy, and the optimization of their reporting.”
The Regulatory Sustainable Investment Solution will cover more than 12,000 corporate issuers by May 2022. ISS ESG has a far bigger coverage universe of up to 35,000 corporate issuers for specific environmental and social variables.
The Regulatory Sustainable Investment Solution can also help investors around the world with their voting and engagement practices. It can be supplemented by ISS ESG's SFDR Collaborative Engagement Solution, which allows investors to collaborate with companies on material ESG themes that are thematically aligned with key mandatory Principal Adverse Impact indicators within the European Union's Sustainable Finance Disclosure Regulation.