Fund manager State Street claims its new scoring system, dubbed “R-Factor”, will help ESG information “become an integral part of the financial system” by meeting the needs of both investors and companies for a transparent scoring methodology.
Environmental, social and governance (ESG) investing is one of the fastest growing areas of investment management—experts believe it could almost double over the next five years. But the problem has always been the provision of ESG information from investee companies. Step forward State Street Global Advisors to break the deadlock. State Street, a fund manager with a hefty $2.8bn under its control, has developed a new scoring system that it claims not only helps investors but also aids companies to boost their ESG (environmental, social and governance) scores. In a report, State Street says that its new scheme, dubbed "R-Factor", is “the change needed for ESG to become an integral part of the financial system”. That is a big