University of Warsaw Researcher Discusses Findings in Risk Management (ESG as a Measure of Credit Ratings): Insurance – Risk Management

2022 JAN 11 (NewsRx) -- By a News Reporter-Staff News Editor at Insurance Daily News -- Investigators publish new report on insurance. According to news reporting from Warsaw, Poland, by NewsRx journalists, research stated, “The aim of this study was to examine the impact of environmental, social, and governance (ESG) measures on credit ratings given to non-financial institutions by the largest credit rating agencies according to economic sector divisions.”

Our news correspondents obtained a quote from the research from University of Warsaw: “The hypotheses were as follows: a strong negative impact on non-financial institutions’ credit rating changes will result from ESG risk changes, and the reaction of credit rating changes will vary in different sectors. Panel event models were used to verify these hypotheses. The study used data from the Thomson Reuters Database for the period 2010-2020. The analysis was based on the literature on credit rating determinants and on papers and reports on COVID-19, ESG factors, and their impact on credit rating changes. Linear decomposition was used for the analysis. To verify these hypotheses, long-term issuer credit ratings presented by Moody’s and Fitch for European companies listed on these stock exchanges have been used.”

According to the news reporters, the research concluded: “In the analyses, financial and non-financial factors were also considered. The results suggested that, within the last year, the methodology presented by credit rating agencies has changed, and ESG factors are one of the basic measures that are used to verify credit rating changes, especially those related to the pandemic.”

For more information on this research see: ESG as a Measure of Credit Ratings. Risks, 2021,9(226):226. (Risks - http://www.mdpi.com/journal/risks). The publisher for Risks is MDPI AG.

A free version of this journal article is available at https://doi.org/10.3390/risks9120226.

Our news editors report that more information may be obtained by contacting Patrycja Chodnicka-Jaworska, Faculty of Management, University of Warsaw, 02-678 Warsaw, Poland.

(Our reports deliver fact-based news of research and discoveries from around the world.)