ESG Scores & Ratings
IdealRatings determines a company’s ESG rating by researching and documenting answers to a series of inputs for each of the three pillars (E, S and G). There are over 130 inputs captured during the research process.
Each pillar has a maximum score of 100, and the weight of each KPI contributes to a company’s overall pillar score is based on an industry-relative model. For example, Health & Safety KPI is considered to be material for energy production sector and not material for the financial sector. The KPI’s weight can differ from industry to another (i.e. Health & Safety KPI has a weight of 15% for a company in the Chemicals industry, yet a weight of 35% for a company involved in energy production)
The sum of the three pillar scores becomes the company’s IdealRatings ESG score, which can be converted to a rating scale as shown below.
Users can also build their own rating and scoring methodology by selecting to include only certain ESG KPIs and/or inputs and weighing them according to their own scale.