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In partnership for the goals? The level of agreement between SDG ratings

Bauckloh, Tobias
Dobrick, Juris
Höck, André
Utz, Sebastian
Wagner, Marcus

This study analyzes the level of agreement of Sustainable Development Goal (SDG) ratings across five different rating providers. It documents a low level of agreement that is particularly pronounced for companies from the Energy, Healthcare, and Basic Materials sectors. Moreover, the low level of agreement is mostly driven by some individual SDGs. When analyzing implications, we find different return characteristics and risk factor exposures of portfolios sorted according to SDG ratings of different rating providers. Overall, our analyses show that current SDG ratings fail to provide a clear signal of companies’ contribution to the SDGs which can have severe consequences for sustainability transitions and their financing.

Sponsor
Stiftung Mercator for a project entitled 'Wissenschaftsplattform Sustainable Finance' (Rahmenprogramm Sustainable Finance, grant number 19026202)
Citation
In: Journal of Economic Behavior and Organization Volume 217 / (2023-12-09) , S. 664-678; eissn:1879-1751
Collections
@article{doi:10.17170/kobra-2024092610886,
  author    ={Bauckloh, Tobias and Dobrick, Juris and Höck, André and Utz, Sebastian and Wagner, Marcus},
  title    ={In partnership for the goals? The level of agreement between SDG ratings},
  keywords ={330 and Vereinte Nationen. Generalversammlung: Resolution 70/1 (2015) and Portfoliomanagement and Rating and Nachhaltigkeit},
  copyright  ={http://creativecommons.org/licenses/by-nc/4.0/},
  language ={en},
  journal  ={Journal of Economic Behavior and Organization},
  year   ={2023-12-09}
}