🚨 Moody’s & Sustainability: ESG is Now a Credit Rating Factor! 📊💚
With #$40T in ESG assets under management, Moody’s is reshaping how financial markets assess creditworthiness. No longer just about profits & losses, a company’s sustainability risks now directly impact credit ratings, borrowing costs, & investment potential.
🔍 How Moody’s Integrates Sustainability into Credit Ratings
🟢 ESG factors impact the credit ratings of 18% of companies & governments rated by Moody’s. (Source)
📊 Issuer Profile Scores (IPS): Measures 15 ESG subfactors (climate risk, governance strength, social responsibility).
📊 Credit Impact Scores (CIS): Rates how ESG performance affects a company’s credit rating & risk profile.
📊 Second Party Opinions (SPOs): Validates Green Bonds & Sustainability-Linked Loans, ensuring funds are climate-aligned.
🔹 Moody’s now assesses over 3,000 entities based on ESG factors.
💰 ESG & Financial Impact: Why Credit Ratings Depend on Sustainability
🏦 Banks & Investors Are Watching
📌 Companies with poor ESG ratings face higher borrowing costs, as investors demand sustainability-linked loans & bonds.
📉 Carbon-Intensive Companies Are High-Risk
📌 Firms with high Scope 3 emissions face 15-20% valuation risks due to carbon pricing & regulatory changes. (Source)
🚀 Sustainability-Linked Bonds & Loans Are Surging
📌 #$1.6T in sustainability-linked bonds & loans have been issued, with Moody’s validating green claims to prevent greenwashing. (Source)
🌍 Moody’s ESG Leadership: Recognitions & Market Influence
🏆 FTSE4Good Index Inclusion (6 Years Running) → Recognizing top ESG performers.
🏆 EcoVadis Bronze Medal → Top 35% of global companies for sustainability.
🏆 CDP Supplier Engagement Leader → Among the top 4% of companies driving supply chain decarbonization. (Source)
🔥 The Takeaway: Sustainability is No Longer Optional
🟢 18% of Moody’s rated companies now have ESG-driven credit adjustments.
🟢 Investors demand transparent sustainability metrics before lending.
🟢 Greenwashing is no longer profitable—credit ratings now hold companies accountable.
📢 Should ESG be an even bigger factor in credit ratings? Let’s discuss below! 👇
Originally published on LinkedIn on 2025-02-27 04:39:26: https://www.linkedin.com/feed/update/urn%3Ali%3AgroupPost%3A82951-7300736262829711360
NamasteGreenIndia sees “Global Yieldscape:
China’s Bonds Take the Low Road
China 2.8%
India: 7.19%
United_States: 4.28%
United_Kingdom: 4.35%
Australia: 4.42%
France: 3.02%
Germany: 2.20%
Japan: 2.31%
Notably, China’s yield has fallen below Japan’s for the first time, reflecting concerns over potential deflation and economic stagnation reminiscent of Japan’s “Lost Decades.” Factors contributing to China’s low yields include weak consumer demand, adverse demographic trends, and significant debt levels. Despite efforts by Chinese authorities to stimulate the economy through interest rate cuts and fiscal measures, these challenges persist, leading investors to seek the relative safety of long-term government bonds, thereby driving yields lower.
In contrast, higher yields in countries like the U.S. and India indicate robust economic activity, higher inflation expectations, and tighter monetary policies. India’s significantly higher yield reflects the country’s growth trajectory and the higher returns expected in emerging markets. Japan’s slightly higher yield compared to China is influenced by its monetary policies and longstanding economic dynamics.
This divergence underscores varying economic conditions and investor expectations across these economies.
Originally published on LinkedIn on 2024-11-29 10:27:47: https://www.linkedin.com/feed/update/urn%3Ali%3Ashare%3A7268209020363046912
