ESG & Investing
S&P Decision to Ax ESG Scores From Bond Ratings Splits Market
- S&P has updated its credit ratings approach to drop ESG scores
- Moody’s, Fitch say they’ll keep using scores in credit ratings
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S&P Global Inc.’s surprise decision to stop providing ESG scores alongside bond-issuer assessments has created a divide at the top of the credit-ratings market, as Moody’s Investors Service and Fitch Ratings say they won’t follow suit.
S&P recently updated its approach to incorporating environmental, social and governance considerations into credit ratings, ditching an alphanumerical scale it introduced in 2021 and instead going back to relying only on text descriptions. The decision follows feedback from investors who said they found the ESG scale confusing, according to a person familiar with the process who asked not to be identified discussing private talks.