Annual impak Score and indicator review

impak announces adjustments to its impak Scores™, impak French 40 index and Potential impact indicator

 

October 21st, 2022, Montreal — impak, the independent impact rating agency, announces adjustments to its rating methodology as part of its annual review process. This will imply changes in impak Scores™ for the entire impak universe, and the adjustment of the IMPAK French 40 index™ ratings. The Potential Impact Indicator formula (part of impak’s SDG Alignment report) has also been reviewed and updated as part of this process.

 

The impak Score™ ranges from 0 to 1,000, and a higher score means the organization contributes to tackle social,environmental, and governance issues in a significant way. impak’s standard and comprehensive rating methodology is based on the Impact Management Project framework and the United Nations’ 17 Sustainable Development Goals. Through three categories (positive impacts, mitigation of negative impacts and governance) the impak Score™ allows investors, banks, and asset managers to better understand the global social and environmental impact of any organization, in parallel with the impact statement. 

 

The current enhanced impak Score™ represents the 8th iteration of impak’s rating methodology, with a more robust algorithm and weightings thanks to the following adjustments: (i) changes in negative impacts criteria weighting to reflect several minor criteria updates and corrections as well as suppression of minor weighted criteria linked to the below changes; (ii) removal of positive impacts linked to philanthropic activities, as well as potential negative impacts (only actual negative impacts will be scored going forward); (iii) new threshold for sector materiality: only activities representing more than 15% of turnover will be retained to define material negative impacts linked to the sector (vs 5% previously; remains 5% for controversial sectors); (iv) Climate Zs: we have introduced a Z: does or may cause harm related to a company’s climate strategy based on the company’s sector’s overall contribution to global GHG emissions, its level of reporting for Scopes 1,2 and 3, its level of focus on the decarbonization of its business model, the overall evolution of its emissions since the 2015 Paris Agreement and its level of implementation of reduction targets. 

 

The IMPAK French 40™, a benchmark index created in February 2020 based on the top 80% of the CAC 40’s index, increases from 188 to 222 out of 1,000. As a consequence, STMicroelectronics (NL0000226223) and Airbus (NL0000235190) are replaced by Publicis (FR0000130577) and Air Liquide (FR0000120073) in the French 40 index™.

 

The Potential Impact Indicator, part of the impak SDG Alignment (iSA) solution, is a 4-notch indicator that summarizes the SDG Alignment and potential impact of an issuer. The current enhanced indicator represents the 2nd iteration of impak’s SDG Alignment methodology.

 

Disclaimer: Information contained in this press release is provided solely for informational purposes and therefore does not constitute an offer to buy or sell a security. Unless mentioned otherwise, information has been collected directly from company disclosures. Ratings are based on impak Finance’s proprietary assessment methodology and provide relative and not absolute value based on extra financial criteria. impak Finance is not liable for the induced consequences when third parties use these opinions either to make investment decisions or to make any kind of business transaction. This information is subject to impak Finance’s terms of use and compliance policies.


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