Europe Included In ICE ESG Reference Data
European companies 1.5x more likely to report Scope 1 and Scope 2 emissions than in the U.S.
European companies provide clearer goals for meeting gender equality and climate objectives
ESG infrastructure and regulations have existed longer in Europe than in the U.S.
Intercontinental Exchange, a leading global provider of data, technology and market infrastructure, announced that its environmental, social and governance (ESG) reference data platform now includes coverage of major public European companies, allowing users to make actionable comparisons across companies, sectors and geographies. Key findings from the database showed significant differences in ESG reporting between the largest companies in Europe and the United States.
ICE recently announced that its ESG reference data coverage included constituents comprising the ICE® U.S. 1000 Index, which measures the performance of the largest 1,000 U.S. companies. The service now includes coverage of the STOXX® 600 Europe Index, which represents 600 large, mid and small cap companies across the European region.
“By providing access to the granular underlying data that companies report as the information becomes available and delivering it in a normalized format, ICE’s ESG reference data is a unique offering in the market,” said Savita Subramanian, Head of ESG Research and U.S. Equity & Quantitative Strategy at BofA Global Research. “ICE’s platform offers organized and unbiased information that is designed to meet the unique needs of investors and enhances the fundamental research and risk management process.”
The most recent data shows meaningful differences in how companies in Europe and the U.S. — represented by companies in the STOXX 600 Europe Index and the ICE U.S. 1000 Index, respectively — approach and act on ESG issues. Below are some of the selected findings from ICE’s team of analysts:
- In Europe, companies are almost 50% more likely to have identified the United Nations Sustainable Development Goal (UN SDG) on Climate Action as an objective for their business, with 74% of European companies committing to this goal, while 25% of American companies have outlined this as a priority.
- European companies are also more likely to report greenhouse gas emissions, with 74% and 74% of companies disclosing scope 1 and scope 2 emissions information, while the data for American companies sits at 46% and 45%, respectively.
- ICE data showed that approximately 58% of European companies had explicitly identified the UN SDG on Gender Equality as an objective, compared to 21% of American companies.
- European and American companies had similar levels of average female board representation, with the average percentage standing at 36% for European companies and at 27% for American companies.
- European companies are also more likely to have explicitly committed to tackling the UN SDG on Responsible Consumption and Production, with 68% of European companies working toward this goal compared to 23% of American companies.
- Approximately 81% of European companies have defined supply chain and sourcing policies, while the same metric stands at 53% for American companies.
“European companies are far more likely to have embraced ESG-related reporting and goals, while this remains a newer initiative among American companies,” said Subramanian. “ESG infrastructure has existed for a longer time in Europe and there are regional and country-specific regulations that require specific disclosures and additional reporting requirements that do not exist in the U.S. Because of this, the demand for ESG products continues to grow and investors on both sides of the Atlantic are trying to satisfy these needs with more robust ESG data and analytics.”
ICE’s ESG reference data service offers users a better understanding of the ESG risks and opportunities that exist in public companies by providing them with comprehensive ESG attributes and indicators at the corporate-entity level and for underlying securities. ICE’s platform provides full transparency into the underlying ESG data reported by companies and other third-party and governmental organizations.
“As more companies report ESG data, and regulations vary in regions around the world, investors and other market participants need access to clean, primary data to benchmark against competitors and make like-for-like comparisons across companies, sectors and regions,” said Lynn Martin, President of Fixed Income and Data Services at ICE. “Access to timely, high-quality and granular information allows customers to quickly evaluate financially material data points and provides a new level of transparency into the management and operational efficiencies of global companies.”
ICE continues to enhance and expand its reference data platform and expects coverage to soon include other regionally specific benchmarks.
There is no standard approach to identify data that needs to be protected.
Industries leading this year’s D&I Index Top 100 are banking, investment services & insurance.
The new dataset combines traditional measures, such as EPS estimates, with ESG data and investor sentiment.
With Ankit Mittal, Business Change Manager, Global Trading, Schroders
Social data is more difficult to find as this component is growing in importance to end investors.