NEW YORK (April 3, 2025) – ISS ESG, the sustainable investment arm of ISS STOXX, today launched a new Sustainability Bond Rating, to provide investors with a sustainability impact and risk assessment at the issuance level for bonds labeled as green, social, or sustainability, along with sustainability-linked (GSSS+) bonds, issued by both corporate and sovereign entities.
“The volume and complexity of labeled bond issuances has increased significantly in recent years, against a backdrop of disparate regulatory and market reporting standards. Our new, differentiated offering addresses investors’ key need for comparative insights on the material sustainability risks and opportunities of a labeled bond at issuance level,” said Till Jung, Head of ESG at ISS STOXX. “This is significant as it is not just building an assessment based purely on general elements from the issuer’s activities and performance.”
The new rating supports a multitude of investor use cases ranging from risk management related reviews such as verifying labeled bonds’ external framework certification or SPOs, through to helping investors fulfil reporting requirements such as EU Taxonomy alignment of securities in a portfolio or fund. Security selection use cases are also supported, such as identifying labeled bonds that carry the highest relevance to the stated sustainability strategies of their corporate or sovereign issuers, as well as impact investment related use cases such as analyzing, researching and verifying where labeled bonds’ proceeds are being channeled and whether impact targets are being met throughout the lifecycle of the bond. These use cases were identified as crucial to investors through extensive market consultations with market participants, global focus groups, and careful methodological reviews of the evolving reporting landscape for labeled debt.
The new Sustainability Bond Rating assesses alignment with established international standards and guidelines on labeled bonds, such as those by the International Capital Market Association (ICMA), as well as alignment with the United Nations (UN) Sustainable Development Goals (SDGs). Its rating measures absolute performance using a 12-point grading scale from A+ (excellent performance) to D- (poor performance). Supplemental data such as alignment with the EU Taxonomy and the estimated greenhouse gas emissions intensity of financed projects can be leveraged to support tailored applications at the discretion of subscribing investors.
The rating is applied across issuance types, Use of Proceeds Bonds (UoP) and Sustainability-Linked Bonds (SLB) and made up of three dimensions – Alignment with International Standards, Environmental and Social Impact Assessment and the Issuer’s Sustainability Strategy. Each dimension is subdivided into topics and further broken down into indicators. For all layers of the rating hierarchy – the overall rating, dimensions, and topics – there are aggregated scores based on the underlying indicator assessments. Drawing on a pool of approximately 400 indicators, an average of approximately 150 indicators per bond are evaluated based on the specific rating structures for each issuance type. ISS STOXX will deliver the new solution through a variety of channels to suit clients’ needs including through data feeds and API for faster integration.
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About ISS ESG
ISS ESG solutions enable investors to develop and integrate sustainable investing policies and practices, engage on sustainable investment issues, and monitor portfolio company practices through screening solutions. ISS ESG 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
About ISS STOXX
ISS STOXX GmbH, through its group companies, is a leading provider of comprehensive and data-centric research and technology solutions that help capital market participants identify investment opportunities, detect qualitative and quantitative portfolio company risks, and meet evolving regulatory requirements. With roots dating back to 1985, we today deliver world-class benchmark and custom indices across asset classes and geographies and serve as a premier source of independent corporate governance, sustainability, cyber risk, and fund intelligence research, data, and related offerings. Our products and services give clients the scale and leverage they need to grow their business more effectively and efficiently. ISS STOXX, which is majority owned by Deutsche Börse Group, is comprised of more than 3,800 professionals operating across 30 global locations in 20 countries. Its approximately 5,500 clients include many of the world’s leading institutional investors who turn to ISS STOXX for its objective and varied offerings, as well as companies focused on ESG, cyber, and governance risk mitigation as a shareholder value enhancing measure. Clients rely on ISS STOXX’s expertise to help them make informed decisions to benefit their stakeholders.
Media Contact:
Sarah Ball
Executive Director, Communications
press@iss-stoxx.com
ISS STOXX Launches Innovative Sustainability Bond Rating Providing Issuance-Level Assessment for Labeled Bonds
NEW YORK (April 3, 2025) – ISS ESG, the sustainable investment arm of ISS STOXX, today launched a new Sustainability Bond Rating, to provide investors with a sustainability impact and risk assessment at the issuance level for bonds labeled as green, social, or sustainability, along with sustainability-linked (GSSS+) bonds, issued by both corporate and sovereign entities.
“The volume and complexity of labeled bond issuances has increased significantly in recent years, against a backdrop of disparate regulatory and market reporting standards. Our new, differentiated offering addresses investors’ key need for comparative insights on the material sustainability risks and opportunities of a labeled bond at issuance level,” said Till Jung, Head of ESG at ISS STOXX. “This is significant as it is not just building an assessment based purely on general elements from the issuer’s activities and performance.”
The new rating supports a multitude of investor use cases ranging from risk management related reviews such as verifying labeled bonds’ external framework certification or SPOs, through to helping investors fulfil reporting requirements such as EU Taxonomy alignment of securities in a portfolio or fund. Security selection use cases are also supported, such as identifying labeled bonds that carry the highest relevance to the stated sustainability strategies of their corporate or sovereign issuers, as well as impact investment related use cases such as analyzing, researching and verifying where labeled bonds’ proceeds are being channeled and whether impact targets are being met throughout the lifecycle of the bond. These use cases were identified as crucial to investors through extensive market consultations with market participants, global focus groups, and careful methodological reviews of the evolving reporting landscape for labeled debt.
The new Sustainability Bond Rating assesses alignment with established international standards and guidelines on labeled bonds, such as those by the International Capital Market Association (ICMA), as well as alignment with the United Nations (UN) Sustainable Development Goals (SDGs). Its rating measures absolute performance using a 12-point grading scale from A+ (excellent performance) to D- (poor performance). Supplemental data such as alignment with the EU Taxonomy and the estimated greenhouse gas emissions intensity of financed projects can be leveraged to support tailored applications at the discretion of subscribing investors.
The rating is applied across issuance types, Use of Proceeds Bonds (UoP) and Sustainability-Linked Bonds (SLB) and made up of three dimensions – Alignment with International Standards, Environmental and Social Impact Assessment and the Issuer’s Sustainability Strategy. Each dimension is subdivided into topics and further broken down into indicators. For all layers of the rating hierarchy – the overall rating, dimensions, and topics – there are aggregated scores based on the underlying indicator assessments. Drawing on a pool of approximately 400 indicators, an average of approximately 150 indicators per bond are evaluated based on the specific rating structures for each issuance type. ISS STOXX will deliver the new solution through a variety of channels to suit clients’ needs including through data feeds and API for faster integration.
###
About ISS ESG
ISS ESG solutions enable investors to develop and integrate sustainable investing policies and practices, engage on sustainable investment issues, and monitor portfolio company practices through screening solutions. ISS ESG 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
About ISS STOXX
ISS STOXX GmbH, through its group companies, is a leading provider of comprehensive and data-centric research and technology solutions that help capital market participants identify investment opportunities, detect qualitative and quantitative portfolio company risks, and meet evolving regulatory requirements. With roots dating back to 1985, we today deliver world-class benchmark and custom indices across asset classes and geographies and serve as a premier source of independent corporate governance, sustainability, cyber risk, and fund intelligence research, data, and related offerings. Our products and services give clients the scale and leverage they need to grow their business more effectively and efficiently. ISS STOXX, which is majority owned by Deutsche Börse Group, is comprised of more than 3,800 professionals operating across 30 global locations in 20 countries. Its approximately 5,500 clients include many of the world’s leading institutional investors who turn to ISS STOXX for its objective and varied offerings, as well as companies focused on ESG, cyber, and governance risk mitigation as a shareholder value enhancing measure. Clients rely on ISS STOXX’s expertise to help them make informed decisions to benefit their stakeholders.
Media Contact:
Sarah Ball
Executive Director, Communications
press@iss-stoxx.com
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