Ping An Insurance (Group) Company of China today announced the creation of the CN-ESG Smart Rating System, a suite of China-specific smart ESG investment tools.
Ping An is one of the largest financial service companies in the world. The company has over 204 million retail customers and 534 million Internet users, and ranked 29th on the 2019 Fortune Global 500 list.
Ping An recently issued “ESG in China,” a report outlining the current state of disclosure and ESG integration among Chinese companies, noting that while the situation has been improving, Chinese corporates continue to lag behind their developed market peers on ESG monitoring and disclosure. The report also noted that many companies are lacking processes for collecting high quality ESG data, and tend not to perform monitoring and benchmarking with their industry peers, creating significant challenges in generating actionable insights to improve performance.
Ping An’s CN-ESG System aims to address many of these issues, and to help promote long-term sustainable investing and corporate sustainable development in China. The system has four dimensions: Environmental (E), Social (S), Governance (G) and Business (B), which can be analyzed in three modules: General Indicators, Industry Matrix and Public Opinion. The system is designed both to help companies gain a better understanding of their own ESG risks and to improve their performance and disclosure practices, and also to help investors identify ESG risk and to aid in the investment process with enhanced information about industries and companies.
The CN-ESG System utilizes international guidelines from the globally influential MSCI ESG Ratings and Dow Jones Sustainability Indices, and is built around the ESG disclosures requirements of the Hong Kong Stock Exchange and the Shanghai Stock Exchange. The system is empowered by artificial intelligence technology for smart data collection, indicator assessments and the scoring process.
Commenting on the new system, and the evolution of ESG in China, Richard Sheng Ruisheng, Board Secretary and Brand Director of Ping An Group said:
“ESG is emerging in China. As a pioneer of ESG in China, by tapping on our experience and technology, Ping An has established its proprietary methodology, investment know-how, and product toolkit in the ESG space. These first-mover advantages have enabled us to create an ESG system with unique Chinese characteristics for the industry.”
Expanding on Ping An’s own ESG efforts, Sheng added, “Ping An Group has placed greater emphasis on long-term sustainable development in its business philosophy, rather than merely achieving short-term financial performance. The Group’s ultimate goal is to achieve a leading ESG position in China and enter into the international responsible investment market. The Group also aims to leverage ESG investing to strengthen its risk management, thereby achieving stable investment growth to create long-term value for investors.”