KUALA LUMPUR, Feb 12 — Environment, Social and Governance (ESG) risks is gaining traction within the US$100 trillion (RM407.7 trillion) global bond market as seen from the surge in assets under management from US$15.9 trillion in 2016 to US$29 trillion in 2019, said RAM Rating Services Bhd (RAM Ratings).
It said this was observed on assets held by investors that are signatories to the United Nations-supported Principles for Responsible Investment’s (PRI) Statement on ESG in Credit Ratings (PRI ESG Statement).
Through this initiative, the PRI aimed to better align investors and credit rating agencies (CRAs) on the importance of ESG issues, it said in a statement today.
RAM Ratings joined the global line-up of six pioneer CRA signatories to the PRI ESG Statement on May 26, 2016. Today, the PRI ESG Statement is supported by 147 investors and 18 CRAs.
“Since July 2018, our views and analysis of ESG factors have been integrated into the relevant sections of our credit rating rationales,” said its chief executive officer, Foo Su Yin.
The PRI had been working with investors and CRAs since the launch of the PRI ESG Statement in 2016, said the rating agency.
This collaboration seeks to promote market understanding of practices, identify gaps in the consideration of ESG factors in credit risk analysis and find ways to address such gaps, it added. — Bernama
Source: The Malay Mail Online