Home / Companies / News /  Sharekhan ties up with Morningstar to include ESG ratings in research reports
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NEW DELHI : Full-service broking and investment platform Sharekhan by BNP Paribas has tied up with Morningstar India to offer ESG (environment, social and governance) ratings for companies under coverage. This move will help traders and investors on the Sharekhan platform in taking a 360-degree view of the companies.

The ESG rating will be provided by Morningstar India, an investment research company on funds, stocks and general market data.

More and more investors are now considering ESG issues to help manage investment risks. The theme was initially driven by institutional investors but is gaining traction among retail investors, too.

On this development, Jaideep Arora, chief executive officer, Sharekhan by BNP Paribas, said, “…we are very proud to incorporate ESG ratings in our research going forward. We strongly believe it is going to assist customers looking to invest in companies that are thinking of the future. Environment, social and governance are an integral part of BNP Paribas’s approach and strategy globally and we believe it is important for our customer here in India to gain from this."

The ratings will allow investors to understand how the companies in their portfolios are managing their environmental, social, and governance, or ESG, risks, relative to their peers.

This rating has been built to enable advisers and investors to directly compare companies across industries, and a refined design aims to make it easier to use as they make investment decisions.

The environmental and social aspects pertaining to investments are gaining traction today. The reasons lay in some of the corporate accidents which happened in the recent past—whether it was a European car manufacturer falsifying the emission test results of the cars it manufactured or a global technology giant facing heat on user data privacy issues. Both these accidents led to severe fines for these companies and altered their financial health.

According to the latest report by Morningstar India, Indian funds based on environmental, social, and governance (ESG) investing philosophy garnered mere 26 crore during the June quarter as incremental flows into existing funds remained muted.

In comparison, such fund witnessed net inflows of 1,200 crore in the March quarter and 3,750 crore in the December quarter of 2020.

However, in a major positive, the report highlighted that retail assets in Indian sustainable funds nearly tripled to 11,970 crore at the end of 30 June against last year.

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