Various

Fallen Angels: Leveraging ESG to avoid zombies

May 18, 2020

Fallen Angels: Leveraging ESG to avoid zombies

In this note we take a look at a cohort of ‘Fallen Angels’, issuers whose debt has been downgraded from investment grade to junk.

As a group, these issuers’ ESG performance lags the S&P 500. We observe four categories defined by the Sustainability Accounting Standards Board (SASB) that stand out as commanding scrutiny from stakeholders:

  • GHG Emissions
  • Labor Practices
  • Product Design and Lifecycle Management
  • Product Quality and Safety

In addition to a high-level ESG assessment, we briefly introduce the notion of a Climate Risk Factor built from carbon intensity estimates and Climate Momentum Signals.

Industry

Material Categories
GHG Emissions
Labor Practices
Product Design and Lifecycle Management
Product Quality and Safety