ISS ESG / RATINGS & RANKINGS
GOVERNANCE QUALITYSCORE
Identify corporate governance risk within portfolio companies.
A data-driven scoring and screening solution designed to help institutional investors review a company’s quality factors and assess risk.
Scores provide an indication of relative risk and are supported by factor-level data that is critical to the research process, while historical scores and data provide greater context and trending analysis to understand a company’s approach to governance over time.
As governance factors play a heightened role in investment decision-making, Governance QualityScore provides investors with invaluable data and insight to support their analysis.
Governance QualityScore uses a numeric, decile-based score that indicates a company’s governance risk across four categories. Click the image to view specific categories.
Clink on the button to view recent updates to the Governance QualityScore methodology
Governance QualityScore Features
GOVERNANCE QUALITYSCORE FEATURES
Governance QualityScore supports investors as they consider governance in their quality analyses and incorporate unique compensation, board, and shareholder responsiveness data into management assessments.
- Decile scores provide a snapshot view of risk
- Red flags identify the companies or behaviors in need of further analysis
- Supporting factor-level data and summary of key risks provide critical insight
- User-friendly tools to screen and monitor potential governance risk in your portfolios
- Profile reports highlight key facts to facilitate issuer engagement
- Ability to benchmark peers for deeper perspective
- Flexible delivery methods, including online screening platform, data feeds, profiles, and access to underlying data
- Global comparability on core governance factors to benchmark companies across markets and regions.
Coverage
GLOBAL COVERAGE
Governance QualityScore global coverage comprises approximately 7,300+ companies in 30 markets, aligning with local market indices, including but not limited to constituents of the S&P 1500, Russell 3000, S&P/TSX Composite, S&P/TSX Small Cap, STOXX600, and JPX-Nikkei 400, augmented with widely held companies. Daily score history is available from 2013.
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COUNTRIES
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COMPANIES
ISS ESG conducts an annual review to determine opportunities to expand our global coverage to meet the needs of investors globally.
Methodology
THE METHODOLOGY BEHIND THE SCORES
Governance QualityScore uses a numeric, decile-based score that indicates a company’s governance risk relative to their index or region. A score in the 1st decile (QS:1) indicates relatively higher quality governance practices and relatively lower governance risk, and, conversely, a score in the 10th decile (QS:10) indicates relatively higher governance risk. Companies receive an overall QualityScore and a score for each of four categories: Board Structure, Compensation/ Remuneration, Shareholder Rights, and Audit & Risk Oversight.
The Governance QualityScore methodology focuses on the qualitative aspects of governance, including global governance standards and alignment with ISS voting policy in each region.
ISS ESG’s annual methodology review ensures that the methodology remains in step with the ISS benchmark policies as they adapt to reflect developments in regulatory and market practice.
- Over 260 factors are analyzed, with the specific factors under analysis varying by region.
- Each factor is assigned a weight, based on an understanding of the impact of governance practices, ISS voting policy, and prevailing governance standards within each region.
- Global comparability on core governance factors enable investors to benchmark core governance practices and risks for companies across markets and regions.
- Scores are refreshed daily and are relative to an index or region.
- Issuers are invited to review and verify their data through routine data verification.
- Year-round focus, with event-driven data updates for capturing changes to a company’s governance structure on an ongoing basis.
DEEP DIVE INTO GOVERNANCE QUALITYSCORE
RESEARCH, SCREEN & ANALYZE RISK
Investors can search, screen, and filter data in ways that suit their needs.
ONLINE PLATFORM
Use ISS ESG’s proprietary DataDesk platform for insight into a company’s corporate governance structures, quick drill-downs into particular areas of concern, and deep dives into underlying governance data.
DATA FEEDS
Easily ingest decile rankings, individual factors, and company identifiers through your own internal processes and highlight scores within internal workflow platforms.
API TO PROFILES
Connect your internal platform to the Governance QualityScore API to directly access Profiles and drill into the key risks, to easily bring governance insight into investment decisions and proxy voting processes.
PARTNERS & PLATFORMS
Governance QualityScore data is available through:
- Alphanse*
- Bloomberg*
- Crux Informatics
- Factset Workstation*
- Open: FactSet
- RIMES Managed Data Services
- Snowflake
- WRDS*
*Limited offering
Governance QualityScore Profiles provide a summary of key risks and detail the governance factors used in determining the company’s scores, including data changes over time and their impact on the company’s score.
Red flag identifiers highlight the areas raising the risk profile; green stars indicate the areas of stronger governance. A Market Alignment field on the Governance QualityScore profile helps identify how a company’s practice for each factor compares to others within its region, furthering the ability to benchmark companies against their peers.
DATA VERIFICATION
Review, verify, and provide feedback on the data used to determine the Governance QualityScore.
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