Third-party ESG ratings of companies are too basic and backward looking the SEC has been told by asset managers.
The statement was made by AllianceBernstein and Neuberger Berman at a meeting of the Securities and Exchange Commission Investor Advisory Committee. State Street Global Advisors and Calvert Research also made statements that ESG corporate disclosures lack consistency and standardization.
Alliance Bernstein Global ESG Manager, Michelle Dunstan, told the committee there remain discrepancies in the way companies report ESG data. She noted a difference in the way bonds and stocks are analysed from an ESG standpoint. Calvert Research Director of ESG Investment Research, Jessica Milano, said only 8% of S&P 500 companies offer ESG reports and not all of it is relevant. She also said that firms that publish more ESG information have a higher performance with firms offering less ESG information have lower returns.