ESG scores of the world's largest banks 2023, by provider

In 2023, the environmental, social, and governance (ESG) scores of the largest banks worldwide varied markedly across different score providers. JPMorgan Chase, the largest bank globally in terms of market capitalization, showed a wide range of scores: when standardized to a score out of 100, the highest score was given by MSCI, at 64.3, and the lowest by S&P Global (previously RobecoSAM), at 34, while the score from Sustainalytics had a value of 41.4. With only one green bond issued as of December 2020, JPMorgan Chase ranked tenth among the leading banks worldwide by value of green bond issuance.

What is ESG investing?

ESG scores measure a company's exposure to long-term environmental, social, and governance risks. These non-financial factors are a growing concern for investors worldwide, and many of them now integrate ESG data in their investment decision-making to have a positive impact on the environment and society. As a consequence, the assets of ESG funds worldwide increased considerably in recent years, reaching a value of 378 billion U.S. dollars in February 2022. ESG factors cover a broad spectrum of sustainability criteria, but environmental concerns are still the main drivers of ESG investing. Despite rising pressure on companies to decrease their impact on the environment, the carbon dioxide emissions of the largest banks worldwide are still far from sustainable.

ESG reporting

Measuring a firm’s ESG performance is not easy, and the lack of transparent and consistent data is perceived by investors worldwide as one of the main obstacles to ESG investing. ESG scores are based on non-financial factors, which are difficult to quantify in the first place. Furthermore, there are several score systems and sustainability reporting frameworks available to measure a firm’s social and environmental impact. As a result, ESG data can be inconsistent and difficult to compare between companies. As of September 2021, the share of investors worldwide satisfied with the quality of ESG reporting stood at only 33 percent, indicating the need for a more standardized reporting framework and stricter regulation.