Look through the data: Investors need to observe the real world ESG threats in front of them

Deep Dive into ESG in emerging markets

Integrating ESG factors into sovereign strategies requires a deeper look at both the ESG metrics and what they can tell us. This is particularly the case in emerging markets (EM).

Sovereign ESG ratings are increasingly used in investment decisions, but as with corporate ESG ratings, it is important to understand what they are measuring. Typically, ESG issues are aggregated from recognised NGO country rankings, such as Transparency International's Corruption Perception Index, or ratings such as the Freedom House score for civil and political freedoms, World Bank Governance Indicators or World Bank compiled data on various subjects.  Breaking down the E, S and G However, the aggregate score masks deeper insights. For example, our research indicates governance r...