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S&P Global Identifies Overlap of ESG and Credit Ratings for Pension and OPEB Analysis
On October 7, 2021, S&P Global Ratings released its issue brief, ESG Pension and OPEB Analysis in U.S. Public Finance. The brief is intended to identify when pension analytics and environmental, social and governance (ESG) intersects with credit rating analysis in U.S. public finance.
According to S&P Global Ratings, ESG factors may overlap with credit rating analysis for pension and OPEB when the prioritization of plan contributions (based on progressive plan governance decisions) is considered in conjunction with risk management, culture and oversight. Further, to mitigate risks, an issuer’s ability to modify benefits, funding methods or plan assumptions is considered in both an ESG-focused assessment of governance and the overall credit rating analysis.
The brief is available here.