Credit Risk and Ratings Initiative

The ESG in Credit Risk and Ratings Initiative aims to enhance the transparent and systematic integration of ESG factors in credit risk analysis.

The PRI is facilitating a dialogue between credit ratings agencies (CRAs) and investors to cultivate a common language, discuss ESG risks to creditworthiness and bridge disconnects.

The initiative kicked off with the launch of the Statement on ESG in Credit Risk and Ratings, still open to signatories and so far supported by more than 180 investors with over $40 trillion of AUM, and 28 CRAs. Four reports have been published as part of the initiative and over 20 forums organised around the world for credit practitioners.

Thanks to the PRI's advisory committee for its support. Contact us if you have any questions.

Statement on ESG in credit risk and ratings (available in different languages)

Latest resources

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Are the TCFD recommendations useful for credit risk analysis?

Read about how investors and credit rating agencies use the information provided by companies following the recommendations of the Taskforce on Climate-related Financial Disclosures in their credit risk analysis.

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Broadening the outreach to investment consultants

Investment consultants are critical stakeholders in the investment chain, advising institutional asset owners on a range of issues, including the selection, appointment and monitoring of external managers.

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Do ESG information providers meet the needs of fixed income investors?

Read the conclusions of our discussion with 20 ESG information providers on how useful their data and product offerings are for fixed income investors and where they need to improve.

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ESG in credit risk: ongoing workshop series

The PRI’s ESG in credit risk and ratings initiative is for the first time bringing voices from the corporate side into the conversation on how to better incorporate ESG factors into credit analysis.

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Credit Rating Agency (CRA) quarterly updates

To see the progress CRAs are making to enhance the integration of ESG factors in credit risk analysis, in keeping with their commitment to the above Statement, check the PRI’s quarterly updates.

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ESG, credit risk and COVID-19

Issuers’ crisis preparations and responses, and bondholder engagement, are two key areas of focus when considering the credit implications of the COVID-19 pandemic through an environmental, social and governance (ESG) lens.

Broadening the outreach to ESG

Broadening the outreach to ESG information providers

As well as continuing to engage with CRAs, the results from this survey will inform future discussions with ESG information providers, to help fixed income investors to best use available tools and analysis for ESG integration in their investment decisions.

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Takeaways from the EM forums

The emerging market forums completed the global series that gathered credit practitioners from investors and CRAs to discuss ESG topics.

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Watch the video on the initiative – phase one

Highlights of the milestones of the initiative since its start. The project is the first of its kind because of its credit focus and scale, with 21 forums held in 15 countries.

SHIFTING PERCEPTIONS – THREE PART SERIES

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ESG, credit risk and ratings: part 1 - the state of play

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ESG, credit risk and ratings: part 2 - exploring the disconnects

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ESG, credit risk and ratings: part 3 - from disconnects to action areas

Webinars

Podcasts

Investor and CRA case studies

ESG in credit risk and ratings forums

To address some of the disconnects between investors and CRAs that emerged at the start of the initiative, the PRI organised roundtables across the globe aimed at credit risk analysts, fixed income portfolio managers and strategists (ESG analysts were welcome if accompanying their colleagues). CRA representatives participated to explain how they incorporate ESG factors in their credit ratings and answered questions.

  • Berlin (PRI in Person – panel session: ESG in sovereign credit risk)
  • The Hague (hosted by Aegon Asset Management)
  • Toronto (hosted by University of Toronto Asset Management)
  • Montreal (hosted by PSP Investments)
  • New York (hosted by Neuberger Berman)
  • London (hosted by Insight Investment)
  • Stockholm (hosted by Öhman)
  • Paris (hosted by AXA)
  • Frankfurt (hosted by Deutsche Börse)
  • San Francisco (panel session hosted by Wells Fargo Asset Management) - video recording
  • Sydney (hosted by the Financial Services Council)
  • Tokyo (hosted by Nikko AM)
  • Singapore (hosted by Eastspring Investments)
  • Hong Kong (hosted by HKIFA)
  • Cape Town (hosted by Investec)
  • San Francisco (PRI in Person – panel session: assessing ESG risks through credit ratings and sustainability scores - audio recording)
  • São Paulo (hosted by Itaú Asset Management)
  • Santiago (hosted by Moneda Asset Management)
  • Beijing (hosted by the Asian Infrastructure Investment Bank)
  • Mexico City (hosted by Compass Group)
  • Paris (PRI in Person – panel session: from disconnects to action – audio recording)

The initiative is funded by the Gordon and Betty Moore Foundation through The Finance Hub.

Gordon and Betty Moore Foundation Finance Hub