Thesis title: |
ESG factors integration into corporate credit ratings: current state & impact of the CSRD |
Author: |
Lernoux, Marion |
Thesis type: |
Diploma thesis |
Supervisor: |
Zárybnická Žárová, Marcela |
Opponents: |
- |
Thesis language: |
English |
Abstract: |
This thesis explores the impact of the Corporate Sustainability Reporting Directive (CSRD) on the integration of Environmental, Social, and Governance (ESG) factors into corporate credit ratings within the EU. Through interviews with key stakeholders, the study evaluates how EU-registered credit rating agencies (CRAs) assess the creditworthiness of EU-based companies, and explores the anticipated CSRD’s effect on non-financial information and corporate credit ratings. The findings reveal that ESG integration into corporate credit ratings across EU remains superficial, characterized by an undefined and subjective approach where ESG factors are often treated as secondary considerations that rarely influence final ratings. The primary obstacles include the lack of sufficient quality and comparability of non-financial information, particularly for smaller companies, along with a lack of tools and expertise to accurately assess their impact. Despite short-term uncertainties and compliances challenges, the CSRD is expected to achieve its long-term goals, by significantly improving the quality, availability, and comparability of ESG information, thereby addressing existing challenges in ESG incorporation for EU-registered CRAs. This enhanced reporting environment is expected to transform the quality of corporate credit ratings in the EU, significantly deepening ESG integration into credit analysis, and decision-making processes. |
Keywords: |
Credit rating agencies; corporate credit ratings; ESG integration; Sustainability Reporting Directive |
Thesis title: |
ESG factors integration into corporate credit ratings: examining the current state and its possibilities of improvement following the CSRD |
Author: |
Lernoux, Marion |
Thesis type: |
Diplomová práce |
Supervisor: |
Zárybnická Žárová, Marcela |
Opponents: |
- |
Thesis language: |
English |
Abstract: |
This thesis explores the impact of the Corporate Sustainability Reporting Directive (CSRD) on the integration of Environmental, Social, and Governance (ESG) factors into corporate credit ratings within the EU. Through interviews with key stakeholders, the study evaluates how EU-registered credit rating agencies (CRAs) assess the creditworthiness of EU-based companies, and explores the anticipated CSRD’s effect on non-financial information and corporate credit ratings. The findings reveal that ESG integration into corporate credit ratings across EU remains superficial, characterized by an undefined and subjective approach where ESG factors are often treated as secondary considerations that rarely influence final ratings. The primary obstacles include the lack of sufficient quality and comparability of non-financial information, particularly for smaller companies, along with a lack of tools and expertise to accurately assess their impact. Despite short-term uncertainties and compliances challenges, the CSRD is expected to achieve its long-term goals, by significantly improving the quality, availability, and comparability of ESG information, thereby addressing existing challenges in ESG incorporation for EU-registered CRAs. This enhanced reporting environment is expected to transform the quality of corporate credit ratings in the EU, significantly deepening ESG integration into credit analysis, and decision-making processes. |
Keywords: |
corporate credit ratings; ESG integration; Credit rating agencies; Sustainability Reporting Directive |
Information about study
Study programme: |
Finance and Accounting |
Type of study programme: |
Magisterský studijní program |
Assigned degree: |
Ing. |
Institutions assigning academic degree: |
Vysoká škola ekonomická v Praze |
Faculty: |
Faculty of Finance and Accounting |
Department: |
Deparment of Finacial Accounting and Auditing |
Information on submission and defense
Date of assignment: |
11. 9. 2023 |
Date of submission: |
2. 9. 2024 |
Date of defense: |
2024 |
Files for download
The files will be available after the defense of the thesis.