Leading asset managers in North America and Europe are increasingly using the corporate ESG profiles, scores, rankings and ratings of third party service providers as they analyze and assess companies in their portfolios, or to screen public companies “in or out” of portfolio.
Asset managers are also developing their own internal, proprietary methodologies for evaluating their investments, for their own accounts and on behalf of their fiduciary clients. A primary example is State Street Global Advisors (“SSGA”), one of the world’s leading asset managers.
The firm developed the “R Factor” (R=Responsible) and to date has evaluated 6,000 public companies’ ESG performance. Since 2017 SSGA has been calling on boards of directors to incorporate ESG / sustainability into their company’s long-term strategies. The R Factor is an important resource for SSGA in its engagements with public company boards and managements and will be a tool used in the asset manager’s proxy voting process.
In January 2020 SSGA CEO Cyrus Taraporevala wrote to the boards of directors of the companies that SSGA invests in to inform them of the R Factor importance and that State Street will be using its proxy voting to press companies falling behind in sustainability or failing to engage with SSGA. Given the importance of these developments to public company boards and managements, we have prepared a Resource Paper to explain the background of the R Factor.
G&A Resource Paper includes:
- Be Ready for what the CEO of State Street is asking of boards of directors
- Learn which third party ESG investor data providers State Street uses in its R-Factorscoring methodology
- Understand what sustainability reporting standards R-Factor recommends
- Comprehend the Four Core Pillars of the R-Factor Score
- Identify the Broader Purpose of State Street's R-Factor
Fill out the form on the right to download a copy.