ANNOUNCEMENT: Expert Investor is now PA Europe. Read more.

Moody’s to buy stake in China-focused ESG firm

It was the first Chinese service provider to sign the UN Principles for Responsible Investment


Kirsten Hastings

Ratings agency Moody’s has struck a deal to acquire a minority stake in SynTao Green Finance (SGTF), a provider of environmental, social and governance (ESG) data and analytics based in and serving China.

Its data covers publicly listed Chinese companies, bond issuers and macro ESG development trends.

In addition, STGF provides thought leadership on ESG to policy markets.

Financial details were not disclosed and the deal is expected to close by early November 2019.

Evaluating risks

Moody’s described the acquisition as aligning with its “ongoing global commitment to promoting transparent standards for evaluating ESG risks”.

“Locally, the investment strengthens Moody’s presence and engagement in China and its financial markets, with a focus on supporting long-term, sustainable growth and contributing to the healthy development of ESG markets.”

The ratings agency said the deal complements its recent acquisitions of Vigeo Eiris, a global provider of ESG research, data and assessments; and Four Twenty Seven, a climate data and risk analysis firm.

Green trailblazer

STGF was the first Chinese signatory joining the UN Principles for Responsible Investment (UNPRI) as a service provider and the first Climate Bonds Initiative Approved Verifier in the country.

It is the sole Chinese green bond verifier within the first advisory council of Green Bond / Social Bond Principles by International Capital Markets Association (ICMA).

STGF also founded the China Social Investment Forum.

Extended reach

“Since its founding, STGF has solidified its position in China as a local standard setter and leading domestic platform for ESG data and analytics,” said Hao Shi, managing director, country manager for Moody’s China operations.

“STGF’s China-specific data sets provide opportunities to enhance Moody’s global ESG research and data.”

He added: “Together we will seek to leverage our respective strengths and capabilities to provide a range of solutions for investor and issuer ESG needs, including joint research, product development and technical cooperation.”

Peiyuan Guo, chairman of STGF, commented: “Moody’s investment will help STGF accelerate its data coverage, adoption and ability to further serve Chinese market participants.”