In the last two years we have reported on the relationship between our internal ESG and credit rating, the ratings of credit rating agencies and the default experience of the global credit fund.
Last year's report can be found under the Investment Information And Performance tab of the Fixed Income and Credit teams profile:
A more detailed description of methodology used can be found in our 2015 Responsible Investment report here:
The results of our analysis shows that where we have a high ESG risk rating we tend to have a lower internal credit rating than the credit rating agencies, this in turn has translated to a significantly lower default experience than investing inline with the credit rating agency ratings.
While ESG is not the only reason for this outcome we believe the research we have done demonstrates a strong relationship.