DEVELOP SYSTEMATIC AND ASSET CLASS-SPECIFIC ESG RATINGS BY COMPANY NB ESG Quotient Company Rating Example: Financials – U.S. Commercial Banks
Quantitative evaluation of the bank’s credit exposure to the oil and gas sector and its emission reduction targets. Analyst evaluation of bank’s net-zero methodology to assess resilience to climate change
ENVIRONMENTAL & SOCIAL
Bank #1
Bank #2
Bank #3
Bank #4
Overall E + S Rating
A
B
C
D
Access to Finance Climate Risk Data Privacy & Security
Leverages third-party data provider’s measurement of data privacy and security protection practices
Consumer Financial Protection Human Capital Development Responsible Investment Business Ethics
Combines proprietary data science analysis of equity, inclusion, and diversity information with third-party evaluation of human capital and training practices Analyzes green financing opportunities and the bank’s policies and procedures related to integrating ESG across its lending platform Analytical studies conducted on the relationship of material ESG factors to investment performance Qualitative analysis, including reviewing specific compensation metrics and looking in detail at board capabilities
GOVERNANCE Overall G Rating
1
2
3
4
Risk Management Expertise Director Equity Policy Annual Incentive Measures Board Gender Diversity
Rating
Stronger
Average
Weaker
Central Research Analyst’s view of the environmental, social and governance characteristics of a company on material factors relative to the peer group. For environmental and social, A – D quartiles where A is best, D is worst. For governance, 1 – 4 quartiles where 1 is best, 4 is worst.
18 2021 ESG ANNUAL REPORT
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