ECPI’s proprietary research model focuses primarily on the ESG (Environmental, Social, and Governance) performance factors that determine issuers’ sustainability and intangible market value.
ECPI research covers over 4,000 issuers and maintains one of the world‘s largest sustainability databases. ECPI research process is both rigorous and disciplined and its proprietary methodology is based only on publicly available information from companies, data provider and media.
ECPI uses an objective, sector-based, best-practices approach to analyzing ESG data of issuers with the objective of translating qualitative data into quantitative indicators, assigning to each issuer a score and a rating.
For a description of the ESG Research and Rating Solutions, click here
ECPI COMPANY RATING
ECPI uses a rule-based approach involving approximately 100 key performance indicators to evaluate an issuer’s environmental, social and governance sustainability.
That analysis produces a score and a rating. ECPI’s proprietary rating scale ranges from “F” to “EEE”, along 9 notches. Rating thresholds may be customized, but its standard ESG methodology generally excludes from the investable universe all companies rated “F”.
* Only when applicable / on clients request
In applying its sector screening methodology to corporate equity and bond issuers, ECPI may exclude issuers operating in any controversial sectors specified by its clients. These might include issuers involved in Alcohol, Tobacco, Pornography, Nuclear energy, Military/Defense, GMO food production, Contraception or Gambling. Exclusions are generally determined by the percentage contribution of the controversial sector to the issuer’s total revenues. These exclusion thresholds varied by controversial sector to reflect clients’ preferences or requirements.
Click here to download ECPI Rating Methodology document.
ECPI COUNTRY RATING
ECPI Sustainability methodology applied to government issuers is aimed to guarantee investors that the investment portfolio is built exclusively with financial instruments issued by Governments which are compliant with international Environmental, Social and Governance (ESG) standards and without any significant liabilities in any of the aforementioned areas.
Since 1948, when the Universal Declaration of Human Rights was created, nations have begun to recognize the importance of respecting human dignity, the freedom of expression and movement, equal opportunities in the work and political spheres, non-exploitative labour practices, respect for the environment, and a non-belligerent approach to conflicts.
Therefore ECPI developed the Methodology to assess the government’s adherence to principles and to practices in aspects such as respect for human and labour rights; respect for the environment and anti-corruption.
REGULATION
The Methodology assesses the level of compliance of a government with a number of international treaties, conventions and best practices, which represent the international standard.
IMPLEMENTATION
The Methodology verifies the effectiveness of a Government in implementing national legislation compliant with international standards and in enforcing it efficiently.
| RATING | LEVEL | DEFINITION |
| EEE | Very good | Countries display full compliance with international ESG standard, effective implementation, and efficient enforcement. |
| EE | Good | Countries display adeguate compliance with international ESG standard, good implementation, and sound enforcement. |
| E | Fair | Countries display partial compliance with international ESG standard, acceptable implementation, and basic enforcement. |
| F | Poor | Countries display poor overall ESG performance or very poor performance in one single area (Environment, Social or Governance). |
| NE | Controversial | Countries retain death penalty and/or are classified not free/partly free in terms of civil liberties and political rights. |
* Only when applicable / on clients request
Click here to download ECPI Country Rating Methodology document.