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7.1 Rating Agencies

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The growth in the sustainability and CSR movements spurred a growth in responsible investing. There are two concepts in play. First, the socially responsible investor wants to only invest in companies that practice CSR. Second, the proposition that sustainable companies and those that have good CSR are better run, more profitable, and will be sustainable. As a consequence, there were several investment firms that added sustainability or CSR to their financial performance assessments. One of the most well‐known rating schemes for sustainability is the Dow Jones sustainability index (DJSI). This index was first started in 1999 and is done for the Dow Jones by RobecoSAM (formerly SAM). It rates over 2500 of the largest companies in the world.

There are a very large number of firms (more than 100) that provide some form of rating for companies in the sustainability and CSR performance sphere in addition to the DJSI. These include VigeoEIRIS, Trucost, MSCI, Oekem, Ethibel, FTSE4Good (EIRIS), Corporate Knights, Institutional Shareholder Services (ISS), and others. This now includes various business and public publications such as Newsweek and Forbes. In addition, while not a rating agency, Bloomberg provides detailed sustainability information on a very large number of companies for those that subscribe to their service.

Why is this important to sustainability or CSR business practices? The majority of these sustainability or CSR rating is based on either public research or most commonly questionnaires and interviews with the companies. What they view as important translates into what the companies view as important. For example, your company might not believe that global warming or water scarcity is a problem for your business. However, the company will definitely be asked to provide detailed information on a risk assessment and plans to reduce the risk. A simple response that the company is not affected will not suffice. The point here is that the areas of emphasis by the rating agencies become areas of emphasis for the ESH professionals. Wellness or Total Worker Health might be very important to the rating agency so it will become important to you if you want a good rating from them as a safety and health example.

Patty's Industrial Hygiene, Program Management and Specialty Areas of Practice

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