KBRA’S Approach to ESG Management

In the last episode of the third season of ESG Talks, Emilie Nadler, an Associate Director on KBRA’s ESG Team, interviews Pat Welch, KBRA’s Chief ESG and Ratings Policy Officer, and Van Hesser, KBRA’s Chief Strategist. As interest in ESG investing grows, financial market participants are increasingly interested in accessing better quality ESG information to make investment decisions and are also looking to rating agencies to understand the relevance of ESG to financial metrics and the risk of default. Pat, Van, and Emilie discuss KBRA’s approach to ESG integration in credit ratings and research.“At KBRA, we believe most ESG issues that intersect with credit risk analysis are inherently management issues. For this reason we call our ESG approach in the corporates, financial institutions, and governments space ‘ESG Management.’ In the world of credit risk analysis ESG can’t be done as a simple scoring exercise – it requires thoughtful analysis of myriad, and often interconnected risk management issues. Our approach gives transparency into the real-world and into the dynamic risks that ESG presents to entities.” – Pat Welch, KBRA’s Chief ESG and Ratings Policy Officer