Skip links

ESG Ratings Decoded

How to Improve Your Score and Gain Investor Confidence

ESG ratings have become a powerful measure of corporate sustainability, influencing everything from investment decisions to customer trust. In 2025, their importance is growing even further as new regulations, stricter investor expectations, and the demand for transparency reshapes how companies are assessed.

For businesses, this means one thing: your ESG score isn’t just a number or letters – it’s a reflection of your resilience, risk management, and long-term value. But with different rating agencies using different methodologies, it can be difficult to know where to focus.

Why ESG Ratings Matter More Than Ever

Once seen as a niche tool, ESG ratings are now critical for securing investment, managing risks, and strengthening market positioning.

  • Investors are using them to guide decisions. Asset managers and banks assess a company’s ESG score before providing financing, offering better loan terms, or investing in long-term growth.
  • Regulators are pushing for greater standardization. With the Corporate Sustainability Reporting Directive (CSRD) and International Sustainability Standards Board (ISSB) frameworks setting new expectations, rating agencies are refining their criteria to align with global standards.
  • Customers and business partners are paying attention. More than ever, buyers, suppliers, and even job candidates are considering a company’s ESG performance when making decisions.

A strong ESG score can unlock new opportunities, while a weak or inaccurate rating can lead to lost investments, reputational damage, and regulatory risks. That’s why understanding and optimizing your ESG score is no longer optional – it’s a business need.

Who Are the Key ESG Rating Agencies?

The ESG rating landscape isn’t one-size-fits-all. Different agencies focus on different factors, which means a company’s score can vary significantly depending on the provider.

  1. MSCI ESG Ratings
    One of the most widely used ESG ratings, MSCI evaluates companies based on how well they manage ESG risks compared to industry peers. Companies are rated from AAA (Leader) to CCC (Laggard).
  2. Sustainalytics (Morningstar)
    Sustainalytics takes a risk-based approach, assessing the level of unmanaged ESG risks a company faces. Scores range from 0 to 100, with lower scores indicating lower risk exposure.
  3. S&P Global ESG Scores
    S&P’s ESG ratings align closely with regulatory reporting frameworks like CSRD and SASB, giving a weighted industry-adjusted score from 0 to 100.
  4. Moody’s ESG Solutions
    Moody’s integrates ESG factors into credit risk assessments, helping investors understand how sustainability risks impact financial performance.
  5. ISS ESG
    ISS places a strong focus on corporate governance, using sector-specific methodologies to score ESG performance.
  6. EcoVadis
    A leading sustainability rating provider for B2B transactions and procurement assessments, EcoVadis evaluates companies based on their corporate responsibility and supply chain practices.

How to Improve Your ESG score in 2025

If your ESG score isn’t where you want it to be – or if you’re unsure how your business is being assessed – there are strategic steps you can take to improve it.

  1. Align with Global Reporting Standards
    With CSRD and ISSB driving standardization, companies that align their reporting with these frameworks will be in a stronger position.

  2. Strengthen Governance & ESG Oversight
    A clear governance structure – including board accountability, ethical leadership, and ESG risk management – can positively impact your score.

  3. Improve Carbon & Climate Disclosures
    With climate risk playing a growing role in ESG ratings, companies need to provide clear, data-backed reporting on their emissions and sustainability targets.

  4. Strengthen Supply Chain ESG Performance
    Many ESG rating agencies assess supply chain risks, meaning companies can be penalized for working with suppliers that lack transparency or ethical sourcing.

  5. Optimize ESG Ratings with Better Data & Communication
    Since ESG ratings rely on publicly available information, missing or inconsistent disclosures can negatively impact a company’s score.

The Future of ESG Ratings: Transparency, Standardization, and Action

With new regulations shaping the way companies disclose sustainability information, ESG ratings will only grow in importance. Businesses that take a proactive approach – aligning with key reporting standards, improving ESG governance, and communicating sustainability effectively – will be the ones that thrive.

This is how EkoElevate helps

At Eko Elevate, we help businesses optimize their ESG ratings, ensuring you’re not just compliant but also strategically positioned to lead in the sustainability space. We offer expertise in:

  • Aligning with evolving ESG reporting frameworks
  • Strengthening governance and risk management practices
  • Improving climate disclosures and carbon strategies
  • Enhancing supply chain sustainability
  • Communicating sustainability initiatives effectively

Want to optimize your ESG score and elevate your business for long-term success? Let’s talk!

Leave a comment

Explore
Drag