NH Amundi Asset Management Develops ESG Bond Issuer Evaluation Model

Evaluation of ESG Ratings for Both Listed and
Unlisted Companies Based on Internal Standards

[Asia Economy Reporter Minji Lee] NH-Amundi Asset Management announced on the 13th that it has developed an ESG evaluation model that can independently assess the ESG ratings of bond issuers.

Currently, ESG-related evaluations in Korea are mainly conducted from a stock perspective focusing on listed companies, making this significant as it establishes a framework for ESG evaluation specifically for bond investments.

NH-Amundi Asset Management is a leading asset management company driving ESG investments. Since the introduction of Socially Responsible Investment (SRI) in 2006, it has been the first in the industry to start pension fund SRI mandates and currently manages the largest scale of SRI operations in Korea.

After CEO Park Hak-joo took office earlier this year, an ESG Promotion Committee was launched, aiming to establish an ESG management system aligned with NongHyup Financial Group’s ESG Transformation 2025 policy. In particular, it declared the vision of ‘ESG First,’ introducing ESG processes across all management divisions and prioritizing ESG in all management decision-making.

The NH-Amundi ESG bond issuer evaluation model began development last year and was applied to ESG operations, completing after about a year of development at the end of last November. The bond research team responsible for development constructed an ESG bond universe and created an evaluation system for issuers. Based on three pillars, it uses a framework of 13 themes and 41 key issues, utilizing a total of 146 data points as evaluation factors, and assigns seven ESG ratings.

Han Su-il, head of the bond management division, explained the development background, saying, “Since ESG evaluations in Korea have been centered on listed companies, there were limitations in applying them to bond management, which mainly invests in bonds issued by unlisted companies. It is meaningful in that it not only evaluates ESG ratings from the bondholder’s perspective but also predicts the direction of changes.”

NH-Amundi Asset Management plans to use the newly developed ESG bond issuer evaluation model as a standard for ESG ratings by company within the bond investment universe and will regularly track and monitor the possibility of rating changes.

This content was produced with the assistance of AI translation services.