What Makes a Great Rating Agency?
TBLI Presentation
30 October, 2008

RiskMetrics Group Research Team
RiskMetrics ESG team is comprised of 53 full time staff. Key advantages of the RiskMetrics ESG research team:
Analysts are located in close proximity to the markets that we
cover, with staff in Brussels, New York, Washington, Toronto, Research is able to develop a deep understanding of the legal
Manila, and Tokyo.
and regulatory climates in which companies operate
The ESG team is further supported by a global research team of RiskMetrics employs thought leaders across topic areas
225+ analysts
Clients have access to the research team
• = RMG Office with ESG Analysts • = Other RMG Office
www.riskmetrics.com 2

The Next Frontier for ESG –
Sustainability Risk Management (SRM)
It takes 20 years to build a
reputation and five minutes
to ruin it. If you think about
that, you'll do things
differently. Class
Action Services
- Warren Edward Buffet
RiskMetrics Group
Sustainability Risk
Management (SRM)
Five pillars of SRM: Climate,
Environment, Labor &
Human Rights, & Ethics.
www.riskmetrics.com 3

SUSTAINABILITY RISK MANAGEMENT (SRM)
Shareholder Resolutions -
Social & Environmental Issues
Values-Based
Proposals
SRM SRM
“E” Reputational Risk –
Climate & Labor & Human Rights
Environmental SRM “S”
Ethics
Risk Product Safety
SRM SRM
Values-Based
Restrictions
Material
Compliance Screening-
Faith-based screens (Tobacco)
Risks
‘Biggest Concerns’
Global Sanctions (Sudan)
www.riskmetrics.com 4

Key areas covered by Riskmetrics
Ethical Screening Sustainability Governance
Governance research, within the ESG group
Our Ethical or Compliance Screening Sustainability research takes a governance
(separate from the proxy research process)
business focuses on specific business lines or approach and seeks to understand the
is aimed to developing an overview of the
practices which some investors choose to policies and practices that companies have
governance structure at covered companies.
avoid, often on moral grounds. in place for managing risk (and
However, this area does draw heavily on the
opportunities) that may arise from
Adult Entertainment broader group of governance analysts and
environmental and social issues.
Alcohol & Tobacco the proxy research process.
Climate change
Animal Welfare Board of directors
Resource use
Contraceptives/ Abortifacients Executive remuneration
Waste management
Weapons & Firearms Takeover defenses and management
Labor practices
Gambling entrenchment
Human rights
Nuclear Power Internal controls
Product Safety
Stem Cell Research Equitable treatment of shareholders
Ethics
Performance Governance (Policy)
www.riskmetrics.com 5

ESG – Summary of Coverage
Riskmetrics’ ESG group divides research into three principle areas – Ethical Screening, Sustainability,
and Corporate Governance. There are approximately 8,800 distinct companies for which we have data
in one or more of these areas.
Corporate
Ethical Screening Sustainability Governance
Europe 641 594 1,199
Americas 5,445 1,169 5,552
Asia 534 202 924
Middle East 37 1 1
Africa 66 0 2
Total Companies 6,723 1,966 7,678
www.riskmetrics.com 6

Research Process
We will seek to fill gaps in our profile by
reviewing third party content from reliable
sources. Our analysts will always seek to
verify any data collected from external
parties. Sources, which will vary with the
company, geography, and the data to be
Third collected, may include:
Disclosure
Parties General Media & Specialist Journals
Trade Organizations
Exchanges
Begin with a Regulatory Agencies
complete review NGO’s
of company disclosure to
Company
build a company profile comprised
of as many as 400 datapoints. Engagement
Sources include:
Company outreach is a two-
Annual Reports
step process. First all Stage 2 is direct company
CSR Reports companies that are scored contact and verification of
have free access to their data materiality assessments
Other Regulatory Filings
via a website and are
Press Releases encouraged to review their
data on a regular basis
Environmental Disclosures
www.riskmetrics.com 7

ESG Investor Toolbox
Our ESG research and tools may be Key advantages to the RiskMetrics ESG product suite:
organized into a product ‘stack’. Content Multiple means of accessing content allows maximum flexibility
may be accessed in research reports,
online applications, and in direct feeds of All scoring models and research notes are fully transparent, with
sources and weights disclosed
raw data. In addition to a broad range of
standardised products, we maintain a very Online tools allow for positive and exclusionary screening
strong bespoke research capability. Online tools allow for simplified monitoring of multiple portfolios
Ethical Screening Sustainability Governance
Insight Social Issues Company Proxy Research Proxy Research
Bespoke
Reports Reputational Risk
Bespoke research
Reports
services may
Analytics Sustainability Scores Governance Scores involve any
combination of a
Modeling Tools (custom custom universe of
scoring) companies, custom
issues, a custom
Online screening application (ESG Screener) allows for analysis of companies across
scoring model, or a
our universe or within a specific portfolio custom delivery
format for data
and/or reports.
Data Any combination of the underlying data across ESG issue areas may be delivered as
a raw datafeed. Datafeeds may be customised for content as well as format and
are typically delivered via ftp
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ESG Screener Screen Builder/Editor Overview
Select from different
view ‘templates’ for Save the results as a
search results portfolio for further
screening or export the
results to a file
Click on a company
See a summary of the
name and then select a
selected criteria for
report to view in the
each company on the
popup menu
list
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Custom Scoring Model
This is an example of a bespoke
scoring model where the
universe of companies, the
research criteria, and the scoring
model are all custom for a single
client.
www.riskmetrics.com 10

For More Information, Contact:
Mark Tulay
RiskMetrics Group, Inc.
1 Chase Manhattan Plaza
Mark.tulay@riskmetrics.com
New York, NY 10005
Tel: +1 212 981.7475
Tel: +1 212 354.3054
Fax: +1 212 575.0251
www.riskmetrics.com
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