ESG Rating

An ESG rating evaluates a company's environmental, social, and governance performance. Rating agencies like MSCI, Sustainalytics, ISS ESG, and CDP analyze publicly available data, corporate reports, and questionnaires to assign a score. This score directly impacts your cost of capital, access to sustainability-focused investors, and position in procurement processes. Companies with better ESG scores typically pay

10 to

40 basis points less for debt financing and qualify for ESG indices such as DJSI or FTSE4Good.

The key ESG rating providers for European companies are MSCI ESG Ratings (widely used by institutional investors), Sustainalytics (owned by Morningstar, assesses ESG risk exposure), ISS ESG (Corporate Rating and QualityScore), CDP (focus on climate and environmental data), and EcoVadis (particularly relevant for supply chain compliance). Each agency uses its own methodology and weightings. From July 2026, the EU regulation on ESG rating providers takes effect, requiring greater transparency in methodologies and conflict of interest management.

Systematic ESG rating improvement starts with a gap analysis: where do your scores deviate from industry benchmarks? Key levers include better data quality and completeness in ESG questionnaires, publishing a structured sustainability report aligned with CSRD standards, implementing measurable climate targets and decarbonization strategies, and establishing clear ESG governance with board-level accountability. ADVISORI prioritizes measures based on their rating relevance at your most important rating agencies.

The timeline for measurable ESG score improvement depends on your starting point and the assessment cycles of the respective agencies. An initial gap analysis and strategy development typically takes

4 to

8 weeks. Implementation of prioritized measures spans

3 to

12 months. First score improvements usually become visible at the next rating update. ADVISORI develops a clear business case with ROI projections so you can weigh the investment against expected capital cost savings and market access benefits.

ESG ratings influence financing on multiple levels: companies with high ESG scores receive more favorable terms on credit lines and bonds. They qualify for green bonds and sustainability-linked loans. Over $

30 trillion is invested globally in ESG-mandated funds that exclude companies with weak scores. Additionally, many large corporations and public sector clients now require ESG ratings as a prerequisite in procurement processes. CSRD requirements and the EU Taxonomy are reinforcing this trend from

2026 onward.

Each rating agency sets different priorities: MSCI ESG Ratings evaluate industry-specific key issues and compare companies within their peer group. Sustainalytics focuses on unmanaged ESG risk exposure. CDP assesses climate data and environmental management through detailed questionnaires. ISS ESG analyzes governance structures and sustainability practices. EcoVadis primarily evaluates supply chain performance. These different methodologies mean a company can receive very different scores from different agencies — making a multi-rating strategy essential.

ADVISORI supports the entire ESG rating improvement process: we first analyze your current scores across all relevant agencies and identify the biggest improvement levers. Then we develop a prioritized roadmap with concrete measures — from improving ESG data management and optimizing questionnaires and reports to strategic communication with rating agencies. We bring experience from successfully improving ESG scores across multiple industries and integrate ESG measures into your existing business processes.