AB: PRISM - Unlocking the Power of ESG Data

Rhea-AI Summary

PRISM 3.0, a digital ESG scoring platform developed by AllianceBernstein (AB), aims to solve the challenges of integrating financially material ESG risks and opportunities into investment portfolios. The platform addresses issues such as hard-to-find and subjective company ESG data, lack of global data standards, and limitations of third-party ESG rating providers.

Key features of PRISM 3.0 include:

• Sourcing nearly 180 metrics from NGOs, governments, and third parties
• Ensuring data integrity and minimizing human biases
• Allowing meaningful comparison of companies within and across industries
• Using industry-relevant metrics for more accurate assessments
• Covering 96-98% of investment-grade, high-yield, and emerging-market corporate bonds
• Freeing up credit analysts' time for targeted engagements with corporate issuers

PRISM 3.0 represents a data-driven solution to turn ESG data challenges into opportunities for better investment decision-making.

Kathleen Dumes, CFA | Responsible Investing Research Analyst-Fixed Income Responsible Investing

NORTHAMPTON, MA / ACCESSWIRE / September 20, 2024 / For a deeper dive into PRISM 3.0, read our paper, Breaking the ESG Barrier: Empowering Credit Investors Through Better and Faster Data.

Transcript

Investors need to integrate financially material ESG risks and opportunities into their portfolios. But that's no easy matter. Company ESG data, when it exists, can be hard to find and subjective. And there are few global data standards, making apples-to-apples comparisons challenging.

Investors looking to avoid data issues frequently turn to third-party ESG rating providers. Unfortunately, not only is there huge variability in ESG scores provided by third parties, but those scores often look in the rearview mirror, ignoring companies' commitments and paths forward.

That's why we've developed a new approach to credit research that allows our analysts to capture, objectively analyze and consistently evaluate financially material ESG metrics, turning a data problem into a data-driven solution.

We call this digital ESG scoring platform PRISM 3.0.

PRISM sources nearly 180 metrics from NGOs, governments and third parties.

This data is not only financially material, in our view, but is also clean, to ensure data integrity. That helps minimize human biases and generates more objective company analyses.

PRISM's resulting ESG scores allow for meaningful comparison of companies, both within industries and across industries. That's because PRISM doesn't try to fit the same generic ESG metrics onto all companies. Because different industries are exposed to different environmental and social risks, PRISM looks at industry-relevantmetrics to provide more accurate assessments.

For example, when analyzing an airline, looking only at carbon intensity may be misleading. Emissions per passenger-kilometer flown better represent an airline's ability to be fuel efficient.

Unlike most third-party scorers, PRISM covers 96 to 98% of the universe of investment-grade, high-yield and emerging-market corporate bonds, including small and unlisted companies.

Lastly, PRISM frees up credit analysts' time, allowing them to focus on targeted engagements* with corporate issuers to gain unique, forward-looking insights-the kind that power active investing.

Ultimately, PRISM puts robust, contextualized ESG data at portfolio managers' fingertips to enable faster-and better-decision-making for client portfolios.

*AB engages issuers where it believes the engagement is in the best financial interest of its clients.

The views expressed herein do not constitute research, investment advice or trade recommendations and do not necessarily represent the views of all AB portfolio-management teams. Views are subject to revision over time.

Learn more about AB's approach to responsibility here.

View additional multimedia and more ESG storytelling from AllianceBernstein on 3blmedia.com.

Contact Info:
Spokesperson: AllianceBernstein
Website: https://www.3blmedia.com/profiles/alliancebernstein
Email: info@3blmedia.com

SOURCE: AllianceBernstein

View the original press release on accesswire.com

FAQ

What is PRISM 3.0 and how does it help investors with ESG data?

PRISM 3.0 is a digital ESG scoring platform developed by AllianceBernstein (AB) that helps investors integrate financially material ESG risks and opportunities into their portfolios. It sources nearly 180 metrics from various organizations, ensures data integrity, and allows for meaningful comparison of companies within and across industries.

How does PRISM 3.0 differ from third-party ESG rating providers?

Unlike most third-party scorers, PRISM 3.0 covers 96-98% of the universe of investment-grade, high-yield, and emerging-market corporate bonds, including small and unlisted companies. It also uses industry-relevant metrics for more accurate assessments, rather than applying generic ESG metrics to all companies.

What percentage of corporate bonds does AB's PRISM 3.0 cover?

PRISM 3.0 covers 96 to 98% of the universe of investment-grade, high-yield, and emerging-market corporate bonds, including small and unlisted companies.

How does PRISM 3.0 address the issue of subjective ESG data?

PRISM 3.0 sources data from NGOs, governments, and third parties, ensuring data integrity and minimizing human biases. This approach generates more objective company analyses and allows for meaningful comparison of companies both within and across industries.

What benefits does PRISM 3.0 offer to credit analysts at AB?

PRISM 3.0 frees up credit analysts' time, allowing them to focus on targeted engagements with corporate issuers. This enables analysts to gain unique, forward-looking insights that can inform their investment decisions.