What is the ESG Risk Rating?
The ESG Risk Rating, developed by Marsh, is a complimentary self-assessment that enables you to measure your organisation’s environmental, social, and governance performance, improve your ESG risks, and gain access to risk and insurance benefits. This free assessment is available to organisations worldwide, including in Asia.
Measuring against more than 10 internationally recognised standards and frameworks — including the Task Force on Climate-related Financial Disclosures (TCFD), the Global Reporting Initiative, and the European Union Taxonomy for Sustainable Activities — the ESG Risk Rating scores your organisation’s performance across 18 ESG themes. On completion of the free assessment, you will receive:
- An overall ESG risk score out of 10.
- A risk rating for each ESG component.
- Scores across the 18 themes.
- A risk assessment and recommendations for your controls, reporting, and resilience.
The risk scores in the Marsh ESG Risk Rating are categorised across five risk levels: very low (0-2), low (2-4), fair (4-6), good (6-8), and high (8-10).
Why take an ESG risk assessment?
Embedding ESG into business strategy is increasingly a source of competitive advantage to the organisations that do it well. The ESG Risk Rating provides you with a clear framework from which to better understand your organisation’s ESG performance, make more informed investment decisions, and potentially negotiate better insurance outcomes.
To learn more about integrating ESG risks into your business strategy, read this article.
How is the Marsh ESG Risk Rating assessment different?
As the world’s leading insurance broker and risk advisor, Marsh developed the ESG Risk Rating with a focus on improving organisations’ risk profile, insurability, and access to financing as opposed to looking to optimise ESG performance from an investment-centric standpoint. Hence, organisations that have already taken an ESG assessment should follow up with the Marsh ESG Risk Rating.
How to use your ESG Risk Rating results
You can use your ESG Risk Rating results to identify your most critical sustainability- and climate-related risks and opportunities, and work with Marsh’s advisors in Asia to further develop your ESG strategies. You can also choose to share that output with stakeholders, many of whom are becoming increasingly inquisitive and concerned about ESG risks.