ABCs of ESG Frameworks and Ratings

Curious about the difference between SASB and SustainalyticsFTSE4Good and the Global 100CDP and DJSIISS and MSCI? Below are short abstracts of each, organized as follows:

  • ESG Reporting Frameworks: CDP, GRI, IIRC, SASB, TCFD
  • ESG Ratings and Rankings:
    • Primarily for Investors: Bloomberg, DJSI, FTSE, ISS, Moodys (VigeoEiris), Morningstar, MSCI, S&P Global (Trucost), Sustainalytics, and Thomson Reuters
    • Primarily for Customers: EcoVadis
    • Primarily for the Public: Corporate Knights Global 100, Just Capital

ESG Reporting Frameworks

CDP: CDP is both an ESG Reporting Framework and an ESG Rating. It was launched in 2002 as the Carbon Disclosure Project, and is a non-profit based in the U.K. CDP runs a global disclosure system for investors and companies, as well as cities, states, and regions.

  • Customer Usage: Widely used. Companies submit information to CDP by filling out the CDP Questionnaire – on one or more of several platforms:
    • CDP Climate – resulting in the CDP Climate Change Score
    • CDP Water – resulting in the CDP Water Score
    • CDP Supply Chain – resulting in the CDP Supply Chain Score
    • CDP Forests – resulting in the CDP Forests Score
  • ESG Ratings Linkages:
    • S&P Global Corporate Sustainability Assessment ‘Climate Strategy’ category is based on CDP Climate Change Questionnaire
    • CDP Climate Score feeds into EcoVadis Scorecard
    • CDP Climate Score is posted on the Bloomberg Terminal®
  • Industry FocusIndustry-specific questionnaires for several industries, and generic questionnaire for other industries.
  • Level of Detail: Considerable detail – within a limited scope (see below).
  • LimitationsCDP is focused predominantly on the “E” in ESG, with a focus on the “G” where it involves governance of specific environmental issues (climate change, water, forests).
  • ScopeLimited – growing from the early focus on carbon/GHG. Even with additions of supply chain, forests, and water, the scope remains focused mostly on Environment.
  • Transparency: Fully transparent methodology and criteria. Ratings report provided to companies aggregates scores at the category level – additional purchase is required to access more granular scoring.

GRI: The Global Reporting Initiative (GRI) formally launched in 1999 and was the first global corporate sustainability reporting framework.

  • Customer Usage: Widely used; since 1999, GRI has become a ‘threshold’ expectation for basic corporate sustainability reporting.
  • ESG Ratings Linkages: GRI feeds into Morningstar: Sustainalytics.
  • Industry Focus: Generic set of standards that apply to all industry sectors.
  • Level of Detail: Considerable; GRI provides extensive detail on each of its disclosure criteria.
  • Limitations: The words “material” and “materiality” are considered by GRI to be far broader than the typical definition of materiality used, for example, by SASB. GRI defines a material issue as one that represents an organization’s impact on economy, environment, and/or society (regardless of the issue’s direct financial impact on the organization).
  • Scope: Addresses the full scope of ESG. Historically very strong and detailed on Environment, and later added very strong content on Social. GRI does address Governance topics, with a special emphasis on governance structures and stakeholder engagement.
  • Transparency: Fully transparent methodology and criteria.

VRF: Formed in 2021 from the merger of the International Integrated Reporting Council (IIRC) and the Sustainability Accounting Standards Board (SASB), the Value Reporting Framework oversees the continued development of integrated reporting and SASB Standards.

– IIRC: Formed in 2010, the International Integrated Reporting Council (IIRC) was established as a body to oversee the creation of a globally accepted Integrated Reporting framework. IIRC uses integrated reporting with various groups, organizations, and businesses to allow them to better communicate progress and value creation to investors. In June 2021, the IIRC merged with SASB to form the Value Reporting Framework, which will oversee the continued development of the integrated reporting framework.

– SASB: Established in 2011, The Sustainability Accounting Standards Board (SASB) was a non-profit organization that provides standards for sustainability information – designed to be financially material to investors. As a standard-setting organization, SASB does not offer compliance evaluations or certifications for reporting companies. SASB and GRI are mutually-supportive but serve different purposes. SASB standards define material sustainability issues as those with established financial impacts and thus important to investors, whereas GRI considers a wider range of stakeholders by defining material issues as those that represent an organization’s external impact on economy, environment, and/or society (but not necessarily financially material). In June 2021, SASB merged with the IIRC to form the Value Reporting Framework, which will oversee the continued development of the SASB Standards.

  • Customer UsageGaining considerable traction – especially since January 2021 when BlackRock CEO Larry Fink recommended that companies follow SASB for industry-specific ESG disclosures.
  • ESG Ratings Linkages:SASB has a linkage with ISS.
  • Industry Focus:SASB standards are specific to individual industry sectors. On average, each industry standard has six disclosure topics and 14 metrics. SASB provides industry-specific standards for about 77 industry sectors and sub-sectors.
  • Level of DetailSASB offers reasonable detail on the specific disclosure topics it addresses.
  • LimitationsWeak on Governance. Very narrow definition of materiality may result in companies needing to leverage additional sustainability reporting frameworks in order to cover the suite of material issues deemed to be important to key stakeholders.
  • Scope:Strong on key Environment topics relevant to each industry sector; selected Social topics; limited on Governance.
  • Transparency:Fully transparent methodology and criteria.


Launched in 2015, the Task Force on Climate-related Financial Disclosures (TCFD) is a set of voluntary climate-related financial disclosures designed to be applicable to companies across industry sectors and geographies.

  • Customer Usage: Gaining considerable traction – especially since BlackRock CEO Larry Fink has recommended that companies follow TCFD for climate disclosures.
  • ESG Ratings Linkages: TCFD feeds into the CDP Questionnaire.
  • Industry Focus: Generic set of standards that apply to all industry sectors.  Supplemental guidance is provided for the financial sector and non-financial sectors.
  • Level of DetailLimited; while there is an extensive amount of documentation about TCFD, the actual level of detail regarding specific disclosure criteria is limited.
  • LimitationsTCFD offers a high-level framework; as such, the disclosure recommendations (for the most part) are quite general.
  • Scope: The TCFD disclosures are organized in four broad sections (which incidentally align almost perfectly with ESG Navigator): Governance, Strategy, Risk, and Metrics. As such, TCFD is more of a “top-down” structure – in contrast with CDP, for example, that started with carbon reporting and expanded from there.
  • Transparency: Fully transparent methodology and criteria.

ESG Ratings and Rankings: Primarily For Investors

Bloomberg ESG Data Service: Bloomberg’s ESG dataset offers ESG metrics and ESG disclosure scores for more than 11,500 companies in 80+ countries. They provide historical data going back to 2006. In 2009, Bloomberg launched Bloomberg ESG Data Service which provides ESG data primarily through the Bloomberg Terminal®, displaying it alongside fundamental financial data. Users access ESG data on the ESG dashboard of the terminal.

  • Core Components: Currently available are:
    • Bloomberg ESG Scores
      • Board Composition Scores
      • Environmental & Social Scores
      • Environmental & Social News Sentiment Scores
      • MSCI ESG Solutions
    • Bloomberg Gender Equality Index (GEI)
  • History:
    • 2009: Bloomberg acquired New Energy Finance
    • 2009: subsequently launched Bloomberg ESG Data Service.
  • ESG Ratings Linkages: ESG data accessible on the Bloomberg terminal includes:
    • CDP Climate Disclosure Score
    • ISS Quality Score
    • RobecoSAM
    • Sustainalytics Rank
  • Company Involvement:
    • This is primarily a data service – companies access ESG data on other organizations using the Bloomberg terminal.
    • The Bloomberg ESG Dashboardprovides key ratios and performance indicators – primarily so users can compare ESG and financial performance across companies.
  • Methodology: Bloomberg’s analysts standardize as-is reported ESG data disclosed by companies in reports, websites, etc., as well as through direct company contact.  Bloomberg ESG Disclosure Ratings are based on ~120 ESG indicators.
  • Rating Scale: Out of 100 (plus the third-party ratings)
  • Target Market: Mid Cap (> $2 billion) to Large Cap (> $10 billion)
  • Update Frequency: ESG Disclosure Scores rate companies annually.
  • Customer Usage: Over 11,500 ESG customers globally – approximately 82% of global equity market capitalization.

CDP: CDP is both an ESG Reporting Framework and an ESG Rating. See above (under reporting framework) for description of CDP.

ISS ESG: Institutional Shareholder Services Inc. (ISS) is the largest proxy advisory firm, providing investment and governance solutions to the financial community. Fund managers pay ISS to advise (and often vote their shares) regarding shareholder votes.

  • Core Components: ISS provides a ‘family’ of ESG ratings solutions to provide investors with insights that help investors minimize risk and spot opportunities.
    • ISS ESG – Corporate Rating: focus on material, forward-looking ESG data and performance assessments (formerly Oekom research, consistently updated for 25+ years).
    • ISS ESG – Environmental & Social Disclosure Quality Score: rates company transparency across environmental and social areas of concern through thorough analysis of company public disclosures.
    • ISS ESG – Governance Quality Score: data-driven focus on risk in board structure, compensation shareholder rights, audit and risk oversight.
    • ISS ESG – Carbon Risk Rating: assesses climate-related performance, including industry-specific challenges and both risk and opportunity focus.
    • ISS ESG – ESG Scorecard: facilitates industry-specific scoring across all ESG dimensions.
    • Other: Custom Rating; ESG Muni Quality Score; ESG Country Rating
  • History:
    • ISS was owned by MSCI until April, 2014 when it was purchased by Vestar Capital Partners.
    • 2015: ISS acquired Ethix SRI Advisors.
    • 2017: Ownership of ISS switched to Genstar Capital.
    • 2017: ISS acquired IW Financial and South Pole Climate Data.
    • 2018: ISS acquired Oekom Research AG, a leader in providing ESG ratings and data, as well as sustainable investment research.
    • 2020: Deutsche Boerse (German stock exchange operator) announced that it is acquiring an 80 percent stake in ISS.
  • ESG Ratings Linkages: ISS Governance Quality Score is included within the Bloomberg Terminal. 
  • Company Involvement: Companies are invited to review, verify, and provide feedback.
  • Methodology:  Collectively, ISS includes a set of ESG topics that are covered:
    • Governance:Analysis of >200 factors that indicate a company’s governance risk across categories: board structure; compensation/remuneration; shareholder rights and takeover defenses; and audit and risk oversight.
    • Environmental: management of environmental risk; carbon and climate; natural resources; and waste and toxicity
    • Social: human rights; labor, health, and safety; stakeholder and society; and product safety, quality, and brand
  • Rating Scale:
    • E&S Quality Score, Governance Quality Score: 1st to 10th decile (1st represents higher quality practices and lower risk).
    • ISS ESG Corporate Rating: A-E rating, as well as 1st to 10th ‘Prime’ designation available to all companies in the top decile.
  • Update Frequency: On an ongoing basis.

LSEG – FTSE Russell’s ESG Ratings: FTSE Group, a wholly owned subsidiary of the London Stock Exchange launched in 1995, originated as a joint venture between the Financial Times and the London Stock Exchange. FTSE Russell is the trading name of London Stock Exchange Group subsidiaries: FTSE Group and Frank Russell Company. FTSE4Good Index: Launched in 2001, FTSE4Good is a series of ethical investment stock market indices launched by the FTSE Group.

  • Core Components: LSEG owns both FTSE Russell and Refinitiv.  This section describes FTSE Russell; Refinitiv is below.
    • FTSE ESG rating based on a score
    • FTSE also produces a company report describing the basis for the company score.
  • History:
    • 2009: LSEG acquires majority stake in Turquoise
    • 2013: LSEG acquires majority stake in LCH Group
    • 2014: LSEG acquires Frank Russell Company
    • 2015: FTSE and Russell Indexes join to create FTSE Russell
    • 2017: LSEG acquires Mergent, The Yield Book and Citi Fixed Income Indices
    • 2019: LSEG acquires Beyond Ratings and a 5.2% stake in Euroclear
    • 2019: LSEG proposed an all-share acquisition of Refinitiv
    • 2021: Acquisition of Refinitiv 1
  • ESG Ratings Linkages:  None
  • Company Involvement: Companies complete questionnaire and are given a rating that is then shared with investors.
  • Methodology: Criteria include three layers come together to produce an ESG rating; 300+ indicators, 14 ESG themes scoring, 3 ESG pillars:
    • Governance: Disclosure of all material ESG impacts and relationship to KBD’s, board oversight, long-term and short-term company goals, climate change policies, commitments, initiatives, and support
    • Environment: Disclosure of emission footprint and efforts to reduce (Scope 1,2 and 3), material and water sourced, management of risk and opportunities
    • Social: human rights; labor, diversity, health, and safety; product safety and quality; community relationships
  • Rating Scale: 0-5, with 5 being the highest.
  • Updated: Last updated: 2019/2020.
  • Usage: 350+ institutions globally.
  • Customer Usage: (Currently researching)

LSEG – Refinitiv: London Stock Exchange Group (LSEG) purchased Refinitiv, a global provider of market data, in 2021. Previously known as Thomson Reuters Financial & Risk, the unit was spun off and rebranded as Refinitiv in 2018. At that time, Thomson Reuters retained 45% and sold a majority stake (55%) to Blackstone Group. In 2019, LSEG agreed to buy Refinitiv.

  • Core Components:
    • Refinitiv ESG Scoresacross 3 (E, S, G) Pillars and 10 Themes;
    • Refinitiv ESG Scorewhich is discounted for ESG controversies.
  • History:
    • Pre-2018:Known as Thomson Reuters Financial & Risk.
    • 2018:Spun off as a unit of Thomson Reuters and rebranded as Refinitiv; Thomson Reuters retained a 45% stake in Refinitiv.
    • 2019:London Stock Exchange Group agreed to buy Refinitiv in an all share transaction.
    • 2021:Sale of Refinitiv to London Stock Exchange Group.
  • ESG Ratings Linkages:  None.
  • Company Involvement: Little; methodology is based on public data.
  • Methodology: Analysis of public information disclosed by companies in reports, websites, etc., as well as through direct company contact. Historical analysis is provided dating back to 2002 for ~1,000 companies (mainly U.S. and European). Criteria include: Roll-up: from ~400 metrics => 186 data points => 10 ESG Category Scores => 3 Pillar Scores and Pillar Weights => to the Refinitiv ESG Score (that also includes “Controversy” topics).
  • Rating Scale: On a scale of A+ to D- and percentile rank scores.
  • Target Market: Mid Cap (> $2 billion) to Large Cap (> $10 billion)
  • Update Frequency: Data is updated weekly. Methodology document (available online) dated April 2020.
  • Customer Usage: Provides ESG data and scores on ~9,000 public companies globally.

Moody’s – V.E:

MV.E (formerly Vigeo Eiris), a Moody’s affiliate, is a rating and research agency.  Moody’s acquired a majority stake in Vigeo Eiris in 2019. Vigeo Eiris is rooted in Europe but now positioned as a global ESG research player, operating under its existing brands as an affiliate of Moody’s Investors Service.

  • Core Components: V.E Sustainability Ratings provide three pieces of information:
    • A forward-looking view re growth and resiliency.
    • An ESG risk exposure view, looking at controversies and sector trends.
    • A sustainability impact view, looking at impacts of operations and products.
  • History:
    • 2019: Moody’s acquires a majority stake in Vigeo Eiris
    • 2019: Moody’s also acquires Four Twenty Seven and SynTao Green Finance
  • ESG Ratings Linkages:
    • E feeds into State Street R-Factor
    • V-E feeds Moody’s credit/ESG analysis
  • Company Involvement: (currently researching)
  • Methodology: Uses a framework on 38 sustainability criteria based on international standards. They take into consideration 6 domains of risk factor analysis and weigh them based on relevancy. The criteria and frameworks are further assessed through 330 indicators allowing the evaluation of managerial systems. Vigeo Eiris is able to produce analysis by sector.
  • Update Frequency: (currently researching)
  • Customer Usage: (currently researching)

Morningstar – Sustainalytics: Launched in 2009, Sustainalytics was acquired by Morningstar in April 2020. (Morningstar had purchased 40% of Sustainalytics in 2017; purchased the other 60% in 2020.) Founded in 1984, Morningstar is a global financial services firm headquartered in Chicago, Illinois, United States. It provides an array of investment research and investment management services. Sustainalytics’ ESG Ratings cover ~11,000 companies and supports hundreds of the world’s foremost investors who incorporate ESG and corporate governance insights into their investment processes.

  • Core Components:
    • Sustainalytics ESG Risk Rating
    • Morningstar ESG Risk Rating Assessment: a visual expression of Sustainalytics ESG Risk Ratings
  • History:
    • Pre-2009:The predecessor companies to Sustainalytics date back to 1992, when Jantzi Research was launched.
    • 2009: Sustainalytics was born from the merger of DSRScoris, and DSS.
    • 2009: Jantzi Research, Canada’s leading ESG research provider, merged with Sustainalytics.
    • 2012: Sustainalytics acquired Responsible Research.
    • 2017: Sustainalytics sold 40% of the firm to Morningstar.
    • 2020: Morningstar purchased the remaining 60% of Sustainalytics (announced in April 2020; closed in July 2020).
  • ESG Ratings Linkages(currently researching)
  • Company Involvement: Companies receive a draft Sustainalytics ESG Company Feedback Report prior to publication, and can provide feedback and additional information.
  • Methodology: Industry-specific criteria; typically cover ~70 indicators in each industry. Focus: covers three dimensions: Preparedness; Disclosure; and Performance.
  • Rating Scale: Out of 100; sector/industry-based comparison. Final score is based on a combination of Exposure (Low/Medium/High) and Management (Weak/Average/Strong).
  • Target Market: Small Cap (< $2 billion) to Large Cap (> $10 billion).
  • TransparencyConsidered to be moderate. Sustainalytics does post company scores.
  • Updated: Annual publication of company reports.
  • Usage: Covers >6,500 companies across 42 sectors.

MSCI ESG Research: MSCI Inc. (formerly Morgan Stanley Capital International and MSCI Barra), is an American finance company headquartered in New York City and serving as a global provider of equity, fixed income, hedge fund stock market indexes, and multi-asset portfolio analysis tools. Launched in 2010, MSCI ESG Research evaluates ESG risks.

  • Core Components:
    • MSCI ESG Ratings Report(provided to companies) provides the basis for the company score.
  • History:
    • 2010:MSCI acquired Risk Metrics (which had acquired Innovest and KLD in 2009).
    • 2014: MSCI acquired GMI Ratings (a 2010 merger of GMI and Corporate Library).
    • 2019: MSCI acquired Carbon Delta, a Zurich-based environmental fintech and data analytics firm specializing in climate change scenario analysis.
  • ESG Ratings’ Linkages: (currently researching)
  • Company Involvement: Companies are invited to participate in a formal data verification process prior to publication of their MSCI ESG Ratings Report.
  • Methodology: Assessment based on 37 key ESG issues. Data collected from government databases, company disclosures, and data from academic and NGO databases.
  • Rating Scale: AAA to CCC
  • Target Market: Small Cap (< $2 billion) to Large Cap (> $10 billion).
  • Transparency: Considered to be very limited, although ratings are publicly available.
  • Updated: On an ongoing basis. Companies have the capacity to update data in their MSCI ESG Portal and request MSCI to reissue the ratings report with the new data (although the process will take at least 1-2 months).
  • Usage: Provide ESG ratings for >7,000 global companies. 

S&P Global Corporate Sustainability Assessment: S&P Global was founded in 1860. In 1999 in collaboration with RobecoSAM, S&P Global launched the Dow Jones Sustainability Index.

  • Core Components:
    • S&P Global Corporate Sustainability Assessment – resulting in the S&P Global ESG Score and also used to determine constituents of the Dow Jones Sustainability Indices.
    • S&P Trucost ESG Analysis
  • ESG Ratings’ Linkages: (currently researching)
  • Company Involvement: Companies complete questionnaire; receive a benchmark report with scoring against peer and global averages..
  • Methodology: S&P Global Corporate Sustainability Assessment (Questionnaire): Industry-specific questionnaires
  • Rating Scale: Out of 100
  • Target Market: Small Cap (< $2 billion) to Large Cap (> $10 billion)
  • Transparency: Considered to be very limited.
  • Updated: Annually. Questionnaires are typically sent to participants in April, with results released in September.
  • Usage: Over 5,000 publicly traded companies were invited to participate in the 2021 S&P Global Corporate Sustainability Assessment in 2021.

S&P Global – Trucost ESG Analysis: Trucost was established in 2000 and has been a subsidiary of S&P Global since 2016. Trucost provides data to investors, companies and policy makers regarding a company’s carbon footprint and impact on the economy.

  • Core Components: (currently researching)
  • History:
    • 2000: Trucost was established
    • 2012: S&P Dow Jones Indices is formed
    • 2016: S&P acquires Trucost
    • 2019: acquires RobecoSAM’s ESG business
  • Company Involvement: (currently researching)
  • Trucost Methodology: (currently researching)
  • Trucost Usage: S&P Global provides data on more than 15,000 companies worldwide. Trucost works with about 82 companies.

ESG Ratings and Rankings: Primarily For Customers

EcoVadis: Founded in 2007, EcoVadis is a paid service designed for corporate procurement teams to assess the ESG performance of their suppliers. Companies that subscribe to one of EcoVadis’ options can evaluate their company’s ESG performance against industry and regional benchmarks.

  • Acquisitions: None known.
  • Company Involvement: Companies provide supporting documents and participate in a customized survey that ranks their organization’s ESG performance. EcoVadis then offers solutions based on the survey assessment results and organization’s industry sector(s).
  • Methodology: Scoring is based on evidence from company, suppliers, stakeholder representatives and 3rd party organizations.
    • Criteria: 21 issues grouped into four themes: Environment, Social, Ethics, and Sustainable Procurement. Each theme is rated on 7 management indicators. Overall score is a weighted average of the four theme scores.
    • Output: Survey results formulate the EcoVadis Scorecard with the CSR Rating.
  • Rating Scale: Themes are each rated on a 0-100 scale; as is the overall rating. Medals (bronze, silver, gold) also may be applicable.
  • Updated: Company scorecards are updated based on company registration.

Usage:  >50,000 rated companies in 150 countries and 190 industries to date; partnered with >450 leading multinational organizations

ESG Ratings and Rankings: Primarily For the Public

Corporate Knights Global 100: Founded in 2002, Corporate Knights (a Canadian company) has (since 2005) published an annual index of the “Global 100 Most Sustainable Corporations in the World.” The timing of this announcement typically coincides with the annual meeting of the World Economic Forum in Davos, Switzerland.

  • Acquisitions: None known.
  • Company Involvement: Companies are invited to participate in a formal data verification process prior to publication.
  • Methodology: Analysis of public information disclosed by companies in reports, websites, etc., as well as through direct company contact.
    • 14 key performance indicators
    • Companies are scored only on those performance indicators deemed relevant to their industry sector.
  • Rating Scale: Out of 100 and also ranked against other companies in the same industry sector.
  • Target Market: Mid Cap (> $2 billion) to Large Cap (> $10 billion).
  • Updated: Annually – in January.

JUST Capital: Founded in 2013, JUST Capital is an independent nonprofit that tracks, analyzes, and engages with large corporations and their investors on how they perform on the public’s priorities. JUST Capital polls Americans annually to identify the issues that matter most in defining just business behavior today. They then define metrics that map to those issues and track and analyze the largest, publicly traded U.S. companies. This analysis powers the JUST Capital Rankings  which serve as a roadmap for companies.

  • Acquisitions: N/A
  • Company Involvement: (currently researching)
  • Methodology: Just Capital focuses on the “People’s Priorities” and prioritizing stakeholders. They gather these priorities by surveying ~4,000 Americans asking what issues are most important to them among ESG. Then they assign each resulting issue to the stakeholder (worker, customer, community, shareholders) that the issue most impacts. Just Capital then determines how each company performs across each issue and stakeholder. All information is shared to the company before being published to promote transparency and fairness.
  • Rating Scale: Ranks companies 1-100 in each category
  • Updated: Yearly
  • Usage: ranks the largest publicly traded companies in the U.S.


Sources: Most of the information above came directly from the websites of the various organizations, along with Wikipedia. One particularly helpful source is below.

ESG Reports and Ratings: What They Are, Why They Matter