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How to Improve ESG Ratings: Workiva's Approach to MSCI

How to Improve ESG Ratings: Workiva's Approach to MSCI

Published 12-20-22

Submitted by Workiva

Workiva MCSI ESG AAA Ratings

Originally published on Workiva

By Mandi McReynolds, Head of Global ESG, Workiva

ICYMI: Workiva recently announced our MSCI ESG Rating has been upgraded from “AA” to “AAA”—the highest possible rating awarded by the organization, a leading provider of critical decision support tools and services for the global investment community. As Workiva’s head of global ESG, I’m proud to say we’re one of only four public SaaS companies in the United States to have earned an “AAA” rating.*

One thing I enjoy most about working in ESG is the sense of transparency among my colleagues. So in the spirit, I want to take a moment to document how we approach ESG ratings like Workiva’s “AAA” MSCI ESG Rating. The specific steps another organization would have to take will vary. That said, what follows are a few universal guiding principles that I believe all ESG leaders should try to keep in mind.

Define your why—don’t chase a rating

This year’s “AAA” rating is the culmination of a two-year effort. Workiva CEO Marty Vanderploeg created a cross-functional ESG Task Force, initially with eight company leaders (now 10). Our first order of business was aligning on our company’s values that could transfer into value for the business and the communities of which we are a part. A lot of smart ESG professionals have fallen into the trap of chasing ratings rather than business value.

Early on, the task force carried out a materiality assessment and stakeholder engagement with both internal and external stakeholders. As we describe it in the The ESG Leader’s Playbook, our teams worked together to outline ESG business value drivers and KPIs. One of those drivers was advancing growth. And one of the ways we measure it is by how many ESG investment funds and indexes include Workiva, the number of Workiva shares held in each, and future opportunities for ESG funds and indexes.

For us, this is where ratings come into play. Workiva’s ESG Task Force agreed to invest time in improving our ESG ratings that matter most to our investors. We determined what scores to focus on by researching the ratings agencies preferred by our current and future investors. MSCI and a few others quickly rose to the top of our list.

You might be tempted, or even told, to skip the foundational work that got us to this point—don’t. If you take only one piece of advice from this post, let it be this: start with governance. In addition to our “AAA'' MSCI Rating, I’m most proud of the perfect governance score Workiva received from another ESG rater: Sustainalytics. Governance is the piece that makes everything else fall into place.

Mind the gap (analysis)

Workiva received an “AA” MSCI Rating in the summer of 2021. Because our organization is comprised of lovable overachievers, after a brief celebration, we began wondering what it would take to reach “AAA.” We conducted a gap analysis starting with the report we received with our “AA” rating, noting every place the MSCI analyst mentioned an opportunity for us to improve.

Because ESG rating organizations use different frameworks, it's critical to understand exactly how the ones you’re focusing on will evaluate your company. MSCI ESG Ratings use a rules-based methodology to measure a company’s exposure to long-term, material ESG risks and its ability to manage those risks. In addition to analyzing our MSCI report, we spent time researching our peers, looking carefully at what ESG issues they reported on as well as how they talked about key issues—and where.

Crowdsource and collaborate

Not only do ESG ratings impact the investment community’s view of a given company, but they also can help ESG leaders. We look at it as a pulse on our stakeholders’ perspective for what is most material concerning ESG risk and opportunities and how those stakeholders are receiving and thinking about the communication of our disclosures.

The biggest takeaway from our gap analysis was that we needed to do a better job of capturing and sharing our ESG story. This problem isn’t unique to Workiva. In a joint study by Workiva and CeFPro, investors said they struggle to find ESG data and what they do find is often too superficial to inform investment decisions. We designed a solution for Workiva centered around collaboration and communication.

First, we began taking greater advantage of our ESG Task Force and the Workiva platform. By design, the business leaders that make up our task force come from disparate parts of our organization. This allows us to identify and connect with diverse subject matter experts quickly. For example, Emily Forrester, Workiva’s Senior Vice President of Human Resources, helped us determine whom from her team should contribute to Workiva’s statement on human capital management.

For many companies, getting leaders and experts from different teams to work together would present a challenge. At the risk of sounding like a corporate brochure, Workiva’s ESG reporting solution genuinely makes it easier to collaborate by giving us a central hub to store and connect our data and creating an audit trail for data assurance.

Communicate and innovate

Second, we communicated through the issuer portal with MSCI more frequently and stopped trying to solve everything in one quarter. We realized this was causing unnecessary stress on internal stakeholders, especially when ESG reporting conflicted with our busier times of year. Instead, we began submitting updated documentation as changes were completed and focused on showing meaningful progress in each of our rebuttals. These relatively simple changes made us more intentional about our outreach and allowed us to build a narrative that was easier for our analysts to digest.

This practice also led us down a path toward more frequent and accessible public ESG reporting—what I believe really set us apart from our peers and solidified our “AAA” rating. Simply making our 2021 sustainability report easier to find increased our quarter-over-quarter downloads by 40%. But we didn’t stop there.

In place of our next annual report, we built a sustainability landing page where site visitors can find up-to-date ESG policies, statements, and disclosures in our ESG Data Center. This concept is also not unique to Workiva. Companies like Walmart are moving away from annual ESG reports in favor of digital hubs where they can share information with stakeholders—including analysts, investors, and customers—on an ongoing basis.

We then worked with Workiva’s web team to analyze heat maps, which are visual depictions of the portions of a given webpage that receive the most attention. With this information, you can glean what website visitors are interested in or struggling to find. One example: Our analysis showed that after spending time on our sustainability page, many visitors went looking for our data privacy and cybersecurity policies. We made those easier to find by adding a link from our sustainability page. It’s probably not a coincidence that MSCI noted Workiva’s strengths in privacy and data security in our “AAA” report.

Looking for more on ESG? Bookmark Workiva’s ESG resource hub and check out an episode of ESG Talk, our weekly podcast available on iTunes, Spotify, and YouTube.

*The 100 Public SaaS Companies in the U.S. For this list, “SaaS companies” are defined as those with >65% of revenue attributed to recurring payments for cloud-based software.

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Workiva Inc. (NYSE:WK) is on a mission to power transparent reporting for a better world. We build and deliver the world’s leading regulatory, financial and ESG reporting solutions to meet stakeholder demands for action, transparency, and disclosure of financial and non-financial data. Our cloud-based platform simplifies the most complex reporting and disclosure challenges by streamlining processes, connecting data and teams, and ensuring consistency. Learn more at

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