Sustainable Investing

Analytics & Insights

Gleaning financially material information from companies requires expert capabilities, trusting partnerships, and robust data sets. Our commitment to rigorous analysis helps investors gain insights they need to make informed decisions.

R-Factor™

R-Factor is a sustainability score developed by State Street Global Advisors (SSGA) that leverages multiple data sources and aligns them to the widely accepted, transparent Sustainability Accounting Standards Board (SASB) Materiality Framework for over 12,000 publicly listed companies. SSGA uses R-Factor as a quantitative input to a variety of investment solutions and as a metric in relevant reports and factsheets. R-Factor scores are also among the many inputs the SSGA Asset Stewardship team may review when performing analysis on portfolio companies.

Why We Built R-Factor™

We believe availability of high-quality, financially material, and consistently reported sustainability data represents one of the biggest challenges facing asset managers as they work to meet the growing demand for sustainability-focused investing from their clients.

We designed R-Factor™ around four core pillars. These pillars define our approach to sustainability data and scoring:

1
Focus on Materiality

We believe that for investors to be able to fully trust and integrate sustainability scoring into their investment process, they must have confidence that the sustainability considerations are material and have a demonstrated link to sustainable long-term value creation. SSGA relies on the Sustainability Accounting Standards Board to identify financially material issues for companies in specific industries and sectors.

2
Commonly Accepted, Transparent Frameworks

We selected the SASB Materiality Map because it is a transparent framework supported by large numbers of investors. We support this framework as it sends a unified message to companies about which sustainability factors are material to a company’s performance and are therefore important to disclose and address.

3
Multiple Data Sources

R-Factor™  is powered by the raw metrics from three different datasets. This approach increases the overall coverage of our dataset, seeking to fill in the gaps that exist with any one data provider. Using the inputs from multiple providers also reduces the potential biases that may be built into a provider's methodology.

4
Strong Stewardship

R-Factor™ scores are among the many inputs the SSGA Asset Stewardship team may review when performing analysis on portfolio companies.

For companies

R-Factor offers guidance on which sustainability topics to focus on and disclose to investors, while utilizing the SASB Materiality Framework as a prism to identify industry-specific, relevant sustainability issues

For investors

By investing in sustainable investing solutions powered by R-Factor™, investors on a sustainable investing journey have the opportunity to potentially assess how their capital is being allocated to companies that are focusing on managing and mitigating financially material sustainability risks as defined by the SASB Materiality Framework.

Featured Insights

R-Factor™ Reinventing ESG Investing through a Transparent Scoring System

Learn how State Street Global Advisors leverages stewardship and investment expertise to create a transparent scoring methodology that we believe will become an integral part of the financial system.

Learn More