S&P Global is to buy RobecoSAM’s environmental, social, and governance (ESG) ratings business, expanding its sustainability dataset, in a move to bolster its services.
The acquisition comes as ratings agencies ramp up their suite of ESG products. Rivals Fitch Ratings and Moody’s have both announced service enhancements in 2019.
Earlier this year, S&P Global launched its ESG Evaluation product. The company had already started to include ESG sections within its issuer credit rating reports on corporate entities.
RobecoSAM’s ESG ratings business analyses more than 4,700 companies. It is comprised of two units: the SAM Corporate Sustainability Assessment (CSA), an ESG scoring methodology to evaluate companies’ sustainability practices, and a unit that offers in-depth reports to companies seeking to understand their performance, relative to their peers.
RobecoSAM’s CSA data has already been used to assess suitability for inclusion in the Dow Jones Sustainability Indices (DJSI), S&P 500 ESG Index and other sustainability indices.
Sustainable investing specialist RobecoSAM, and parent company Robeco, will continue to have access to the CSA data for investment strategies and will provide advice on the CSA methodology.
The Dutch companies will, however, shift their focus on the interpretation and application of ESG data and sustainable investing research for core asset management activities.
Karin van Baardwijk, vice chair of the board of directors at RobecoSAM, said: “This transaction will allow us to focus on the successful integration and application of the CSA data that is used in many of our investment processes. Sustainable Investing is our key strength.”
Douglas Peterson, S&P Global president and chief executive, said: “Today’s announcement is an exciting next step in the evolution of our partnership that will allow S&P Global to create market differentiating ESG products and deliver new content and capabilities to our customers.”
The transaction is subject to customary closing conditions and is expected to close in the first quarter of 2020, S&P Global said.