A Deep Dive into Inrate's Sustainability Ratings and Research Methodology

Inrate’s rating methodology has been carefully developed to reveal real impact based on what a company does, not just what it says. It aligns seamlessly with the expectations of leading regulations such as the EU Taxonomy, CSRD and SFDR and enables investors to uncover sustainability impact that would otherwise be hidden in their portfolio.

Premise
Sustainable finance means more than just considering ESG risks; sustainable investment products need to show how they contribute to social or environmental goals. This in turn requires a sound understanding of the positive and negative impacts of the underlying investments.

Financial market participants still struggle to gain a complete picture of a company’s sustainability performance amid the abundance of traditional ESG ratings that focus on self-reported company information and the risk perspective, rather than actual sustainability.

ESG Impact Rating Methodology
Inrate’s ESG Impact Rating methodology goes beyond reported data provided by companies about their ESG policies and initiatives. It takes an impact angle based on externalities across entire product lifecycles as well as third-party reported adverse business practices to capture the sustainability performance of an entity, comprehensively. Thus, the final rating is a composite reflection derived by combining scores from the Product & Services (P&S) Assessment, the CSR Assessment, and the Adverse Business Practices.