By Gabriel Presler, Head of Enterprise Sustainability
Corporate Sustainability
Morningstar’s Latest Corporate Sustainability Report is Here
Read Time: 3 Minutes
At Morningstar, we have a front-row seat to how transparency leads to progress. We’ve always believed that investors have a right to understand what’s in their portfolios—and we’re equally certain that our stakeholders deserve transparency into all relevant aspects of how we conduct business.
When it comes to building a sustainable business well-positioned for the future, our appetite for transparency drives our strategy. We use ESG data to track our performance on the issues that are most material to our business. This work provides insight into our employee experience, management strategy, and business performance. Our teams acknowledge that sustainability—as a corporate strategy—is critical for recruiting talent, mitigating future risks, and managing long-term growth.
This year, our Corporate Sustainability Report examines how Morningstar is grappling with some of the biggest challenges facing industry leaders: How we support our teams and build diverse perspectives into our decision-making process; how we protect data privacy and security and the trust of our clients; how we build a future-focused firm that is positioned to thrive in a period of climate transition; and—critically—how our products and services contribute to the sustainability of our markets, our environment, and the communities in which we live and work.
Last year, we detailed Morningstar’s data security practices and created an open methodology for sizing and reporting data breaches. In this year’s report, we focus on enhancing disclosure about our workplace, providing a lens into the nature of our diverse representation, employee engagement, and turnover. We disclose gender diversity by job function in our teams, including research, data management, technology, and client-facing roles. These in-depth examinations drive accountability and help us to work towards a more equitable workplace.
We hold ourselves to particularly high standards of transparency when it comes to the gender and racial pay gap. we expanded disclosure on equity in compensation across the entire global organization. Once again, we made public the dollar amount that is required to close the gap. This kind of disclosure isn’t required, but by quantifying and addressing the gap, we aim to attract and retain talent, ensure equitable compensation practices, and build trust with colleagues and with the market.
Importantly, we remain committed to partnerships and international agreements that support formidable goals for our industry and the markets we serve. This includes the work that future-focused leaders are doing to ensure that growth becomes less energy intensive and that businesses chart a decarbonization path. In 2022, Morningstar joined the Climate Data Steering Committee and became a member of the Net-Zero Data Public Utility (NZDPU). Alongside our peers and nongovernmental organizations, we are working to provide freely accessible, critical climate data to the public. This work ensures access to climate information for investors, consumers, and stakeholders, and will allow more informed decisions on the transition to a greener economy.
We’re using that kind of climate data to measure and plan for our firm’s future, too. This year, we released our first Climate Transition Plan, which outlines our commitment to a net zero future and our approach to measuring and managing our emissions. Like other firms, we don’t have a clear line of sight into all aspects of this effort—the energy, policy, technology, and market backdrop will surely shift—but our work is to articulate interim targets and make sure we’re on a path to achieve that goal, supported by and responsive to the best available climate science and data.
Providing decision-critical data is consistent with our mission to empower investor success. We also align with SASB standards because we know how important it is to supply the market with comparable performance metrics across an industry, and help investors understand what the data is telling them about our sustainability progress.
ESG may be a politically charged issue in the US right now, but sustainability program efforts, measured with transparent data sets, just aren’t controversial: They’re critical for workers who seek reliable safety standards, for first-time job seekers who want transparent compensation schemes, and for new savers seeking to align their investments with their values. The work we do is designed to make sure that Morningstar is in the position to support investors for the long term and contribute to a more just and sustainable world.