ESG Update: 2022 Dow Jones Sustainability Index Results

Increased complexity calls for further activation of sustainability programs
ESG Update: 2022 Dow Jones Sustainability Index Results
Publ. date 10 Dec 2022
On Friday the 9th of December, S&P Dow Jones Indices announced the results of its annual Dow Jones Sustainability Indices (DJSI) review. Air Liquide, GEA Group, TotalEnergies and Whitbread are among the new members in 2022’s Indices, while Caterpillar, Zurich Insurance Group and Rio Tinto are part of the companies which lost their spot in the World Index. With the ESG playing field becoming more complex, activation of corporate sustainability programs is an essential factor for success. This article summarizes the DJSI results and pinpoints the corresponding takeaways from Finch & Beak’s new State of ESG 2023 Report.

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In 2022, S&P Global introduced a new, staggered approach to release the outcomes of its Corporate Sustainability Assessment and the resulting Dow Jones Sustainability Index notations (for those companies that are eligible to be included in the Indices, which is determined based on their market capitalization).

DJSI-eligible companies already received their ESG Scores in September and October of this year, but they had to remain patient until the 9th of December to learn about their inclusion in the Indices. Overall, the CSA 2022 was open for a larger number of companies, saw higher levels of active participation, and was characterized by challenging methodology updates.

Key takeaways from the results

Based on S&P Global’s release, the following takeaways became evident:

  1. More (smaller) companies invited for the CSA:
    During 2022, the total number of companies invited to participate in the CSA increased from approximately 11,000 to more than 13,000. The list has been particularly expanded to include more mid-caps and non-listed companies whose sustainability performance is considered to be of interest to the broader investment community.
     
  2. Higher level of active participation among DJSI-eligible companies: Almost half (49%) of the invited companies that are eligible for DJSI-inclusion filled out the questionnaire this year. In total, during 2022, S&P Global welcomed more than 900 companies participating for the first time or that returned after taking a break.
     
  3. Challenging methodology updates in 2022:
    Major updates were applied in the 2022 assessment for all industries on environmental policy and management systems, climate strategy, and occupational health & safety. For specific industries, additional questions were posed in areas such as biodiversity, and decarbonization strategy for banks, insurance, and other financial companies.

    The changes emphasized the need for companies to be aware of emerging material topics, to have a solid climate approach based on TCFD and net-zero targets, and to have extensive, group-wide policies implemented to mitigate environmental and social risks. Finch & Beak’s further observations from the 2022 Corporate Sustainability Assessment can be found in this article.

The attached summary at the top of the article contains highlights of the DJSI results across DJSI World, Asia Pacific, Emerging Markets, Europe and North America.

What’s next? State of ESG 2023

The DJSI results for 2022 again call for companies to accelerate their ESG performance against the backdrop of a volatile and dynamic business and stakeholder environment. Finch & Beak’s State of ESG 2023 Report is now available and provides guidance to companies looking to increase the effectiveness of their sustainability programs and for corporate decision makers looking to prioritize their budgetary limitations.

Finch & Beak helps you to accelerate results from ESG benchmarking

With over 15 years of experience in Dow Jones Sustainability Index support, Finch & Beak is Europe’s leading expert in improving our clients’ sustainability programs and ESG benchmark performance.

The Finch & Beak vision is to accelerate sustainability. Our ESG and sustainability strategy work is characterized by a continuous improvement method that leverages existing assets in the short term while identifying opportunities for strategic development in the future.

If your organization is looking to accelerate its ESG performance, please download our service description or contact Gijs-Jan Groeneveld at gijs-jan@finchandbeak.com or +31 6 28 02 18 80 to discuss how Finch & Beak could support you.

Photo by Natalie Pedigo on Unsplash

About Nikkie Vinke

Multidisciplinary advisor in ESG benchmarking, sustainability strategy development and execution. | nikkie@finchandbeak.com

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