ESG and Sustainable Finance Solutions | Bloomberg Professional Services (2024)

FAQs

Why is ESG important for financial services? ›

So, financial services companies that use ESG criteria are well suited to attract investors. Risk: Using ESG criteria, firms can limit their exposure to risks such as reputational damage or climate change.

The ESG Disclosure Score is a percentage figure that represents your aggregated level of disclosure against quantitative ESG data points drawn from global standards, that are considered to be most relevant for your industry.

How much does a Bloomberg terminal cost per month? The cost of a Bloomberg terminal is about $2,000 per month.

ESG Scoring, a Financial Materiality Framework

ESG scores provide a quantitative representation of a company's environmental, social, and governance performance, which can have an impact on a company's financial performance and risk profile.

When occurring, ESG risks will have or may have negative impacts on assets, the financial and earnings situation, or the reputation of a bank. ESG risks include environmental risk, social risk and governance risk and the resulting impact on banks' P&L and liquidity.

We find very little evidence that ESG ratings are related to global stock returns over 2001-2020. In other words, returns on investment are greater in companies that act badly, rather than those that act better.

There is currently no federal mandate for ESG (Environmental, Social, and Governance) reporting in the United States. However, there are various initiatives and regulations that require companies to disclose certain ESG information.

The challenge of unstructured data

Unlike financial reports which come down to dollars and cents, much of the information in ESG reports cannot be easily calculated or quantified. Both structured and unstructured data play a critical role, even if it only leads to estimates and subjective evaluations.

Best for: Expert portfolio analysis

Morningstar Premium covers a wide range of financial solutions, but those most relevant to audiences similar to Bloomberg's are Morningstar Direct (built for professional investors and firms) and Morningstar Investor (built for individual investors).

Why is Bloomberg Terminal so powerful? ›

The Bloomberg Terminal revolutionized an industry by bringing transparency to financial markets. More than four decades on, it remains at the cutting edge of innovation and information delivery — with fast access to news, data, unique insight and trading tools helping leading decision makers turn knowledge into action.

One way to access a Bloomberg Terminal for free is through participating in a trial period that offers temporary and complimentary access to the platform. During the trial period, users can explore the extensive features of the Bloomberg Terminal without incurring any costs.

Environmental, social, and governance (ESG) scores are an essential tool for investors to assess a company's sustainability and ethical performance. These scores typically range from 0 to 100, with a score of less than 50 considered relatively poor and more than 70 considered good.

To analyze the ESG performance of an individual company, load the company and then type FA ESG <GO>. To generate an ESG report for a company via the Excel plug-in, type XLTP XESG <GO> . To screen for companies based on their ESG performance, type EQS <GO> to open the equity screening function.

ESG stands for Environmental, Social and Governance. This is often called sustainability. In a business context, sustainability is about the company's business model, i.e. how its products and services contribute to sustainable development.

Examples of how ESG risk management and performance improvement can lead to better financial performance include: Greenhouse gas (GHG) emissions: Prioritize assets to decarbonize based on emissions intensity (focus on highest emitting operations) and potential for business disruption (contribution to company revenue)

Environmental, social and governance (ESG) investing, also known as sustainable investing, is rapidly transforming financial markets. By integrating ESG factors into investment decisions, ESG investors are seeking to create a more sustainable future while generating superior financial returns.

Investors increasingly believe companies that perform well on ESG are less risky, better positioned for the long term and better prepared for uncertainty.

ESG stands for Environmental, Social, and Governance. Investors are increasingly applying these non-financial factors as part of their analysis process to identify material risks and growth opportunities.