The credit team of an asset manager develops its own quantitative score to measure ESG risk. Which of the following factors might lead to an improvement in their ESG score for an oil producer?
A.
A decrease in water reuse
B.
An increase in cash flow projections
C.
A decrease in injury frequency per million man-hours
A decrease in injury frequencyreflects improvedworker safety practices—acore “S” (social) factorin ESG risk scoring. Cash flow projections relate to financial analysis (B) but not ESG directly. A decrease in water reuse (A) wouldworsenenvironmental performance, not improve it.
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