- Precision Impact Assessment: New rating provides granular sustainability insights at the individual bond issuance level for green, social, sustainability, and sustainability-linked (GSSS+) bonds.
- Investor Utility: Supports a wide range of use cases, from EU Taxonomy compliance to impact tracking and security selection aligned with sustainability strategies.
- Robust Methodology: Evaluates approx. 150 tailored indicators per bond using a 12-point scale and global standards like ICMA and the UN SDGs.
ISS ESG, the sustainable investment arm of ISS STOXX, has launched a Sustainability Bond Rating that offers investors a new way to assess the sustainability impact and risk of labeled bonds at the issuance level.
“The volume and complexity of labeled bond issuances has increased significantly in recent years, against a backdrop of disparate regulatory and market reporting standards,” said Till Jung, Head of ESG at ISS STOXX.
“Our new, differentiated offering addresses investors’ key need for comparative insights on the material sustainability risks and opportunities of a labeled bond at issuance level. This is significant as it is not just building an assessment based purely on general elements from the issuer’s activities and performance.”
Labeled bonds are proliferating—and so are investor needs to assess them. This new rating bridges the gap by offeri:
- Comparability across bonds: Especially critical in today’s fragmented regulatory landscape.
- Alignment checks: Measures adherence to standards such as ICMA, UN SDGs, and includes EU Taxonomy alignment.
- Investor customization: Subscribers can apply supplemental data like GHG emissions intensity to tailor decision-making.
The rating spans two primary bond types—Use of Proceeds (UoP) Bonds and Sustainability-Linked Bonds (SLBs)—evaluated through three core dimensions:
- Alignment with International Standards
- Environmental and Social Impact Assessment
- Issuer’s Sustainability Strategy
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Each is broken into specific topics and indicators, with about 150 indicators per bond assessed from a pool of ~400. Scoring is done on a 12-point scale from A+ (excellent) to D- (poor)
ISS STOXX will deliver the new solution through a variety of channels to suit clients’ needs including through data feeds and API for faster integration.
This delivery approach ensures the tool can plug directly into investor systems for real-time decision-making.
ISS STOXX’s new Sustainability Bond Rating gives institutional investors a data-rich, methodologically sound, and customizable framework to assess and act on the sustainability potential—and risks—of labeled bonds at the issuance level.
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