CSRHub Blog Research on ESG metrics and comments on sustainability best practice

CSRHub - What's Changed After Ten Years of CSR Ratings: Part One

[fa icon="calendar'] Nov 7, 2018 10:06:07 AM / by Bahar Gidwani

Part 1 of a 2-part series.

In 2008 CSRHub began measuring performance in corporate social responsibility (CSR). Using ten years of history, we are now starting to answer questions such as: 

  • Has CSR performance improved over time?
  • What area of CSR is improving the most?
  • Is the universe of companies for which ratings are available expanding beyond the large public corporations?
  • How strong is the alignment between CSR performance and company CSR reporting on CSR?

 

Steady Overall Improvement

CSRHub’s ratings incorporate the input of virtually every major source of opinion about how companies treat environment, social, and governance (ESG) issues.  Our patented methodology weights and combines these opinions in a way that makes them comparable both between companies and over time. 

The chart below on Average CSRHub Ratings shows that since 2008, average ratings increased by almost 9 points to a peak in 2016. They fell somewhat over the last two years, but have still ended up by 6 points over ten years. Even from 2008 to 2010, through the worst of the Great Recession, ratings rose. The year-to-year changes are modest and gradual over time, suggesting there have been fundamental changes in business strategy for these companies during this period.

 CSRHub Average Ratings

 

Growth in the universe of rated companies may have diminished this improvement


We only provided sustainability ratings for around 2,000 companies in 2008—we could only find about 50 ESG data sources at that time.  By now, we have gathered data on more than 140,000 companies from 550 sources—and offer ratings on more than 18,000.  The growth in our ratings universe appears to have diminished the overall increase in ratings.

The chart below shows that the average rating for all companies in our universe rose more slowly through 2014 than for the consistent set shown above.  Then, as a flood of new companies began reporting information, the average rating for all companies has slowly dropped.

 Average RatingsSlumped

 

Clear Shifts in Emphasis – the top rated CSRHub category for most years has been “Employees”


Our overall ratings are based on twelve subcategory ratings that in turn feed four different category scores.  We’d written previously about the fact that the emphasis between our four category scores seemed to shift over time.

These shifts appear to be continuing. Governance rose sharply during the 2008-10—probably as a response to the 2008 financial crisis.  Environment ratings surged in between 2012 and 2016, as companies responded to pressure on climate change and water issues.  Employee issues have remained the most highly rated area since 2010 while Community ratings started as the lowest in 2008 and have stayed near the bottom.  The idea that companies are more concerned about their employees than the community they live in is something we believe other ratings groups have not yet noticed.

ECEG Levels

 

Look for part 2 in our series tomorrow, as we continue to explore CSR trends.

Download the full report

 


Bahar_Gidwani-10Bahar Gidwani has built and run large technology-based businesses for many years. Bahar holds a CFA (Chartered Financial Analyst) and was one of the first people to receive the FSA (Fundamentals of Sustainability Accounting) designation from SASB. Bahar worked on Wall Street with Kidder, Peabody, and with McKinsey & Co. He has founded several technology-based companies and is a co-founder of CSRHub, the world’s broadest source of corporate social responsibility information. He has an MBA from Harvard Business School and an undergraduate degree in physics and astronomy. He plays bridge, races sailboats, and is based in New York City

CSRHub is the largest ESG and sustainability rating and information platform globally. We aggregate 180M data points from 550+ data sources including 12 leading ESG analyst databases. Our patented algorithm aggregates, normalizes, and weights data to rate 18,000 companies in 132 countries across 136 industries. We track 97% of world market capitalization. We cover 12 subcategories of ratings and rankings across the categories of environment, employees, community and governance. We show underlying data sources that contribute to each subcategory’s ratings. CSRHub metrics are a consensus view (any 2 sources may have about a 30% correlation so we make sense of the disparate data). We tag companies for their involvement in 17 Special Issues. We provide Macro-enabled Excel dashboard templates, customizable dashboards, and an API. Our big data technology enables 85% full coverage of data across our rated companies and robust analyses. We provide historical ratings back to 2008.

Read More [fa icon="long-arrow-right"]

[fa icon="comment"] 0 Comments posted in CSR ratings, CSR Rankings, Ten Years of Ratings History

A Webinar on Solving the ESG Data Problem - Q&A

[fa icon="calendar'] Oct 31, 2018 12:11:54 PM / by Bahar Gidwani

Bloomberg ESGHub webinar 3

CSRHub recently shared fresh insights into how to more effectively use ESG Data.  Bloomberg sponsored the webinar and many of those attending were Bloomberg terminal users.  CSRHub also invited members of its community to hear how to get more out of ESG Data.

We have made the presentation slides used during the webinar available for you to download and use as a reference. 

You may request the webinar replay here.

CSRHub recently launched an application called ESGHub on the Bloomberg terminal (APPS ESGH <GO>).  The app combines CSRHub data with Bloomberg’s ESG Metrics to create a new tool for examining portfolios and other large sets of investment instruments.  The webinar attempted to show why this type of tool is needed and how the tool may help better integrate ESG data into the business processes of those who have a Bloomberg terminal.

Request an Overview of ESGHub

ESGHub Guide 1

Bloomberg’s ESG Metrics is one of the largest sources of company self-reported ESG data.  Bloomberg collects information on 900 indicators from about 10,000 companies.  Other ESG sources use human analysts to generate company ESG ratings.  We showed webinar attendees that company self-reported and analyst-generated ratings tend to be inconsistent and confusing.

Patrick Drum, a senior portolio manager from Saturna Fund, shared his process for selecting instruments for his Sustainable Bond fund.  He reviews a number of specific company-reported items and integrates input from several human analyst rating sources.  His slides showed how hard it was to get consistent company-reported data.  He also illustrated the range of views that human analysts had on the three instruments he wanted to evaluate.

We then showed how CSRHub’s ESG data aggregation normalization process improves the correlation between both self-reported and human analyst data sets.  We discussed the overall distribution of CSRHub’s consensus ESG ratings and showed CSRHub’s big data processing system can bring into focus the data for a particular company.

The ESGHub app (a ten day free trial is available on the Bloomberg terminal at “APPS ESGH <GO>”) brings together Bloomberg and CSRHub data into an easier to understand and use format.  Two thirds of those who attended indicated that they were encouraged now to make more use of ESG data.

The audience asked a number of interesting questions:

Q: Can ESGHub be used to screen green or gender bonds?

A: Yes, if the issuer has shared data on its sustainability programs.  ESGHub combines data from Bloomberg and CSRHub.  It can only screen an issuer if there is data available from both of these sources.

Q: How is CSRHub’s approach to generating a consensus score different from simply averaging a number of ESG ratings?

A: CSRHub scores are a better estimate of consensus than any single or simple average.  The webinar slides gave good examples of the focus and clarity that CSRHub’s Big Data system produces.  There is also information on the CSRHub web site about its proprietary aggregation, mapping, and normalization process.

Q: What strategies for engaging companies about ESG deficiencies could come from using ESGHub?

A: A company that is low on disclosure (has a poor Bloomberg ESG Metrics score) but that is well-regarded for its sustainability performance (has a good CSRHub rating), should disclose more.  One who has the opposite problem needs to improve its internal ESG programs.  ESGHub users should be able to both offer useful advice to companies and illustrate their advice by making ESGHub charts that compare a company to its peers.

Q: Would ESGHub cover companies that other ratings sources don’t?

A: During the webinar, Patrick offered an example of three instruments he considered for his fund.  It was encouraging to see that all three had CSRHub ratings.  Because CSRHub aggregates so many different sources, it should generally have more ratings than any other ESG data source.

 


Bahar_Gidwani2_preferredBahar Gidwani has built and run large technology-based businesses for many years. Bahar holds a CFA (Chartered Financial Analyst) and was one of the first people to receive the FSA (Fundamentals of Sustainability Accounting) designation from SASB. Bahar worked on Wall Street with Kidder, Peabody, and with McKinsey & Co. He has founded several technology-based companies and is a co-founder of CSRHub, the world’s broadest source of corporate social responsibility information. He has an MBA from Harvard Business School and an undergraduate degree in physics and astronomy. He plays bridge, races sailboats, and is based in New York City.

CSRHub is the largest ESG and sustainability rating and information platform globally. We aggregate 180M data points from 550+ data sources including 12 leading ESG analyst databases. Our patented algorithm aggregates, normalizes, and weights data to rate 18,000 companies in 132 countries across 136 industries. We track 97% of world market capitalization. We cover 12 subcategories of ratings and rankings across the categories of environment, employees, community and governance. We show underlying data sources that contribute to each subcategory’s ratings. CSRHub metrics are a consensus view (any 2 sources may have about a 30% correlation so we make sense of the disparate data). We tag companies for their involvement in 17 Special Issues. We provide Macro-enabled Excel dashboard templates, customizable dashboards, and an API. Our big data technology enables 85% full coverage of data across our rated companies and robust analyses. We provide historical ratings back to 2008.

Read More [fa icon="long-arrow-right"]

[fa icon="comment"] 0 Comments posted in ESGHub, Bloomberg ESG

Harvard Business Review Best-Performing CEOs Ranking with CSRHub ESG Metrics

[fa icon="calendar'] Oct 23, 2018 8:54:39 AM / by CSRHub Blogging

Harvard Business Review (HBR) has published its annual global Harvard Business Review_CSRHubranking of the 100 best-performing CEOs, with Pablo Isla of the Spanish fashion retail giant Inditex topping the list for the second year in a row. Following behind Isla in the #2 and #3 spots are Jensen Huang of NVIDIA and Bernard Arnault of LVMH. They’re joined by newcomers to the top 5 this year, François-Henri Pinault of Kering (#4) and Elmar Degenhart of the German automaker Continental (#5). Salesforce CEO Marc Benioff has climbed to the #6 spot, up from #12 in 2017.

The list, which appears in HBR’s November-December issue, is different from other leader rankings in that it measures performance for the entire length of a chief executive’s tenure. “In a business environment that often seems obsessed with today’s stock price and this quarter’s numbers, our ranking takes the long view,” said HBR Editor in Chief Adi Ignatius.

Harvard Business Review’s article stated, “To compile the list, HBR looked at CEOs of the S&P Global 1200 as of April 30, 2018, and calculated overall shareholder return and increase in market capitalization over their entire tenure. It also factored in ratings of corporate environmental, social, and governance (ESG) performance provided by two firms, CSRHub and Sustainalytics. (Read more about the methodology.)” 

The HBR article stated “Among the biggest shifts companies face right now is in the global political environment….Whether and when CEOs speak out doesn’t factor directly into our rankings—but such activism may be captured indirectly in ESG scores, according to the experts at CSRHub and Sustainalytics, the firms that help us crunch the data. For instance, ESG ratings do account for company lobbying expenditures, the degree of disclosure on issues such as carbon use, and the presence of a sustainability officer at the company’s top level, among other measures. A CEO’s political statements (or lack thereof) may also show up in data gleaned from employee review sites such as Glassdoor. The phrase “CEO activism” connotes proactive behavior by leaders—but more and more often, dealing with political realities is just another facet of a multifaceted job.”

“We are honored to have CSRHub ESG (environment, social, governance) metrics included in the methodology to determine the HBR Ranking of the World’s Best-Performing CEOs for the third year in a row” said Cynthia Figge, CSRHub CEO and Co-founder.

See the full report available in Harvard Business Review Magazine, found here.  

To learn more about CSRHub, our ESG/CSR metrics or how you can improve your ESG scores, contact us here.

 


CSRHub is the largest ESG and sustainability rating and information platform globally. We aggregate 180M data points from 550 data sources including 12 leading ESG analyst databases. Our big data patented algorithm aggregates, normalizes, and weights data to rate 18,000 companies in 132 countries across 136 industries. We track 97% of world market capitalization. We cover 12 subcategories of ratings and rankings across the categories of environment, employees, community and governance. We show underlying data sources that contribute to each subcategory’s ratings. CSRHub metrics are a consensus view (any 2 sources may have about a 30% correlation so we make sense of the disparate data). We tag companies for their involvement in 17 Special Issues. We provide Macro-enabled Excel dashboard templates, customizable dashboards, and an API. Our big data technology enables 85% full coverage of data across our rated companies and robust analyses. We provide historical ratings back to 2008.

Read More [fa icon="long-arrow-right"]

[fa icon="comment"] 0 Comments posted in Harvard Business Review, Best Performing CEOs, ESG Metrics

Bloomberg and CSRHub Webinar – Solving the ESG Data Challenge

[fa icon="calendar'] Oct 16, 2018 9:30:39 AM / by CSRHub Blogging

Bloomberg ESGHub webinar

With the increased demand for ESG (environment, social, governance) data and conflicting opinions on company performance by different data providers, investors are searching for ways to measure ESG, variance among different ESG ratings and correlations between leading datasets. 

Join us Wednesday, October 24th at 11:00 am EDT to help solve your ESG data challenges. Patrick Drum, Senior Investment Analyst for Saturna Capital will share his investment strategy tips. 

The strategy session will be followed up by a panel of ESG experts who will discuss how to successfully navigate the evolving landscape of ESG data using the new ESGHub app at APPS ESGH <GO>.

 

Register here. 

 

Featured speakers

Patrick Drum Patrick Drum
Senior Investment Analyst
Saturna Capital
Cynthia Figge Cynthia Figge
CEO and Cofounder
CSRHub
Bahar Gidwani Bahar Gidwani
Cofounder and CTO
CSRHub

 

Discussion Topics

  • Make sense of the broad array of information with a big data approach
  • Discuss a new class of portfolio analysis tools to increase value and reduce risk
  • Explore new strategies for using ESG information

 

Date & Time

Wednesday, October 24, 2018
11:00am – 11:30pm EDT

 

About the app

The ESGHubTM app allows you to quickly review any portfolio of stocks or bonds and see how much ESG information each originating entity has disclosed. 

Test drive the ESGHub app for free before the webinar by running APPS ESGH <GO> on your Bloomberg Terminal.

 

About the business

The Bloomberg App Portal is your destination for the applications you need to optimize your workflow, better analyze the markets, and stay ahead of the curve. The apps on the App portal have been created by world class analytics companies and global investment banks, all integrated with the powerful data and analytics of the Bloomberg Terminal. Visit APPS <GO> today to search, trial and run apps that can help you stay on top.

 

 

Read More [fa icon="long-arrow-right"]

[fa icon="comment"] 0 Comments posted in ESGHub, Bloomberg ESG

CSRHub’s Bahar Gidwani Talks About ESGHub Bloomberg App with Proactive Investors

[fa icon="calendar'] Oct 9, 2018 7:35:00 AM / by CSRHub Blogging

CSRHub co-founder and CTO, Bahar Gidwani was recently interviewed by Christine Corrado of Proactive Investors about CSRHub and the new ESGHubTM app on the Bloomberg App Portal.

ESGHub provides subscribers with the ability to compare metrics from Bloomberg and CSRHub at the portfolio level and drill down on the details associated with more than 9,000 companies.

CSRHub's ESGHub app is listed as ESGHub on the Bloomberg App Portal or can be accessed directly at {APPS ESGH <GO>}.

Learn More About ESGHub

 

ESGHub Guide 1

 

Bahar Gidwani has built and run large technology-based businesses for many years. Bahar holds a CFA (Chartered Financial Analyst) and was one of the first people to receive the FSA (Fundamentals of Sustainability Accounting) designation from SASB. Bahar worked on Wall Street with Kidder, Peabody, and with McKinsey & Co. He has founded several technology-based companies and is a co-founder of CSRHub, the world’s broadest source of corporate social responsibility information. He has an MBA from Harvard Business School and an undergraduate degree in physics and astronomy. He plays bridge, races sailboats, and is based in New York City.

CSRHub is the largest ESG and sustainability rating and information platform globally. We aggregate 180M data points from 550+ data sources including 12 leading ESG analyst databases. Our patented algorithm aggregates, normalizes, and weights data to rate 18,000 companies in 132 countries across 136 industries. We track 97% of world market capitalization. We cover 12 subcategories of ratings and rankings across the categories of environment, employees, community and governance. We show underlying data sources that contribute to each subcategory’s ratings. CSRHub metrics are a consensus view (any 2 sources may have about a 30% correlation so we make sense of the disparate data). We tag companies for their involvement in 17 Special Issues. We provide Macro-enabled Excel dashboard templates, customizable dashboards, and an API. Our big data technology enables 85% full coverage of data across our rated companies and robust analyses. We provide historical ratings back to 2008.

 

Read More [fa icon="long-arrow-right"]

[fa icon="comment"] 0 Comments posted in ESGHub

Subscribe to Email Updates

Lists by Topic

see all

Posts by Topic

see all

Recent Posts