MSCI seeks to strengthen ESG investment research with acquisition

MSCI, a provider of investment decision support tools, has sought to strengthen its environmental, social and governance (ESG) offering with the acquisition of GMI ratings, which provides ESG ratings and research to institutional investors.

GMI ratings has been acquired through the subsidiary MSCI ESG Research and the deal is expected to be closed in the third quarter of this year, subject to closing conditions. The acquisition cost $15 million (£8.8m).

John Higgins, chairman of GMI Ratings, explained that by becoming part of MSCI, with its global footprint and resources, the firm’s ability to incorporate ESG factors into the investment process should be enhanced and bring additional benefits to clients as a result.

Remy Briand, managing director and head of ESG research at MSCI, said, “The acquisition of GMI enhances MSCI’s position as a leader of ESG research.

“The addition of GMI’s corporate governance research and ratings will enable MSCI to offer its clients a depth and quality of coverage across all three pillars of ESG research that will be unmatched in the marketplace. These tools are growing in importance as investors seek to understand more fully the risks of their portfolios.”

The trend of responsible investment has gradually been gathering momentum as more investors look to incorporate ESG factors into their decisions and portfolios. Over the last few years the myth that sustainable investment means sacrificing return has finally been “withering away” Joe Keefe, president and CEO of Pax World Management has previously explained.

Photo: danist07 via Freeimages 

Further reading:

Church of England and MSCI team up for ethical investment screening

Myth of sustainable investment performance sacrifice ‘finally withering away’

F&C: responsible investment ‘continues to gather momentum’

Responsible investment terms: what is ESG?

Asset owners crucial in promoting ESG practices