Related information
What to know about MSCI’s interactions with companies we evaluate
When I started out as a sustainability analyst in the dark ages, long before joining MSCI, I used to call companies to ask for clarifications about information such as workforce practices and pollution disclosures that served as key inputs into scoring and assessing their material sustainability risks. Invariably the person on the other end asked “What?” or “Why?,” as in, what in the world would investors want with such information?
Fast forward to last year, when a majority (52%) of the world’s listed companies in developed markets — and 46% across all markets — proactively reached out to provide MSCI with updated sustainability-related information or to verify data we’ve already collected, according to my colleagues on our issuer relations team. That’s a six-fold increase over the past decade, when we started a dedicated program for all the companies that we cover to provide such feedback.
Proactive issuer outreach (% of issuers)
Source: MSCI ESG Research, data as of Dec. 31, 2024. Markets represented by the MSCI World IMI Index, the MSCI ACWI IMI Index, and the MSCI Emerging Markets Index, respectively. Proactive issuer outreach is the percentage of companies in the relevant MSCI index that have reached out in a given year and is one measure of proactive issuer engagement. Proactive data feedback rate is the percentage of corporate issuers in the MSCI ESG Ratings industry universe that submitted voluntary data feedback through our online issuer portal during that year.
The ramp-up in activity reflects two drivers.
First is that more companies have gotten the memo that their cost of capital can be impacted by their resilience to financially material sustainability risks. A growing body of academic and industry studies make the fundamental business case. There are now significant investments for which sustainability factors are an explicit consideration, including more than USD 1 trillion tracking MSCI’s climate and sustainability indexes.
Second is that companies increasingly have data — and more frequently updated data — to share with investors and other stakeholders, as they’ve improved their internal processes to produce disclosures that meet mandatory or voluntary standards.
I have been most struck that companies’ transparency and proactive engagement with our firm has continued at a steady pace throughout the past two years. This aligns with the latest data from the MSCI Sustainability Institute’s Transition Finance Tracker, which shows that more companies are disclosing their emissions and aiming to decarbonize.
A focus on climate data
What are companies most focused on when it comes to what they want the global investor community to know? For the third consecutive year, the largest share (45%) of data points that companies gave proactive feedback on relates to climate data, with a large share of such feedback about greenhouse gas emissions and energy consumption.
Just over one-fifth (21%) of overall feedback from companies concerned data tied to risks associated with human capital (think labor management, employee turnover or health & safety), while roughly 12% focused on datapoints covering varied facets of corporate governance, our analysis shows.[1]
Topics of proactive feedback (# of submitted data points ‘000)
Source: MSCI ESG Research, based on data points submitted each calendar year by companies in the MSCI ACWI IMI Index, which captures large-, mid- and small-cap listed companies across 23 developed-market and 27 emerging-market countries. With 8,390 constituents, the index covers approximately 99% of the global equity investment opportunity set, as of April 30, 2025.
It will be interesting to watch how companies’ self-disclosure and attention to these topics evolve as sustainability disclosure becomes increasingly standardized. Nearly one-third of the world’s listed companies are in countries with sustainability disclosure mandates — a figure that could reach 50% if countries like Canada and Japan implement similar regulations.
Adoption of mandatory disclosure may obviate the need for companies based in those countries to engage proactively to ensure that our assessment reflects their data. At the same time, companies in countries without climate disclosure mandates that meet global baselines could find it more important to proactively match the greater transparency of their global peers.
Workforce data in demand
Climate data aside, the disclosure gap on companies’ human capital practices could widen across markets. The quality of workforce and organizational culture has long been the intangible information most sought by investors. With more companies adopting AI to enhance innovation and productivity, and long-term demographic shifts impacting the availability of labor, investors’ interest in differentiating organizations’ learning capacity will only increase.
As it happens, transparency on workforce-related issues could see a boost in markets with mandatory reporting regimes. Under changes proposed by the European Union to its Corporate Sustainability Reporting Directive, for example, information pertaining to companies’ own workforce (ESRS S1) constitutes roughly 16% of the total possible data points, nearly matching those related to climate change (18%). In India, which has required its largest 1,000 companies to report under its Business Responsibility and Sustainability Reporting directive since the 2022-23 financial year, key data on workforce characteristics and practices have become widely available to investors and stakeholders. At the same time, investors may be less likely to receive such information in countries such as the U.S., where companies have hesitated to disclose data on human capital topics in the absence of a disclosure mandate.
To be sure, investors recognize that standardized disclosures can only partially (and then only imperfectly) capture the quality of a company’s talent or the contribution of its culture to financial performance and resilience. But when it comes to human capital, investors take the data they can get.
In the end, companies and investors alike may benefit from companies taking a proactive approach to disclose corporate sustainability data. The financial relevance of such information, and the global nature of capital flows, means that investors the world over will continue to seek more and better data regardless of local disclosure requirements. And for investors who view transparency itself as a signal of managerial quality, one takeaway from my experience may resonate: Sometimes, you just have to ask.