ROCKVILLE, Md. (February 8, 2021) — ISS ESG, the responsible investment arm of Institutional Shareholder Services Inc. (ISS), today announced the release of methodology enhancements to its industry-leading Governance QualityScore (GQS) rating solution for global institutional investors.
Today’s release covers several areas of emerging concern to investors, chief among them the management of cyber risk. Eleven of 17 new factors being added to the scoring methodology address information security risk management and oversight to assess, for example, board members’ information security expertise, frequency of briefing the board on information security matters, whether the company maintains a cyber risk insurance policy, the existence of, and financial impact from, recent security breaches, and more.
“Against the backdrop of SolarWinds and other major breaches affecting both the public and private sector, it’s no surprise that institutions are sharply focused on identifying and mitigating cyber risks within their portfolios,” said Marija Kramer, Head of ISS ESG. “We are pleased to help investors bridge this critical information gap through today’s release and will continue to deliver to market cutting-edge solutions that deliver actionable insight to a wide array of financial professionals.”
Other notable factors included in today’s methodology release explore diversity and inclusion (D&I), compensation controversies, and board practices. On D&I, Governance QualityScore will look at whether a U.S. company’s board reflects any racial or ethnic diversity and, separately, the degree to which global companies outside of Japan and South Korea disclose D&I performance measures for the short-term or any long-term incentive plan for executives. New factors will also examine the independence level of board sustainability committees, whether a company has afforded special grants to certain executives in the most recent fiscal year, and the percentage of the CEO’s total compensation that was due to special grants in the most recent fiscal year.
To learn more about ISS ESG’s industry-leading Governance QualityScore ratings, please click here.
About ISS ESG
ISS ESG solutions enable investors to develop and integrate responsible investing policies and practices, engage on responsible investment issues, and monitor portfolio company practices through screening solutions. It also provides climate data, analytics, and advisory services to help financial market participants understand, measure, and act on climate-related risks across all asset classes. In addition, ESG solutions cover corporate and country ESG research and ratings enabling its clients to identify material social and environmental risks and opportunities. For more information, please visit us at: www.iss-esg.com
Subodh Mishra, Managing Director
Institutional Shareholder Services Inc.