Issues of Sustainable Finance Rating Assessment

Abstract

The formation of a sustainable finance market creates the need for independent and reliable information necessary for making investment decisions. The most important source of such information is ESG-ratings designed to assess the degree of commitment of enterprises to the declared priorities of sustainable development. Such ratings are already included in the professional toolbox of most investors. However, the ESG-ratings market is currently in its infancy stage and is relatively immature with a number of characteristic problems inherent in it. Based on the analysis of Russian and foreign scientific literature and analytical reports of consulting companies, the key problems hindering the development of this market, limiting the practical potential of using ESG ratings and undermining the trust of customers and users to these ratings have been identified. The analysis of the correlation between ratings calculated by various providers with consideration of methodological factors that predetermine discrepancies between ratings at the fundamental level is carried out. The review of the current state of the Russian ESG-ratings market is made taking into account current geopolitical challenges and the latest regulatory initiatives proposed by the Bank of Russia