Moody's Corp at JPMorgan Ultimate Services Investor Conference - ESG Panel Discussion with Martina Merten (Virtual) Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Judah Efram Sokel - JPMorgan Chase & Co, Research Division - Analyst : I'm going to start off with a question that is really for all 3 of you. And that is really maybe about the role of ESG in general. In terms of investment decisions, how has the role of ESG coalesce over the past 5 years? How do you envision the area continuing to evolve over the next 5 years? I know it's a broad, big picture question, but you can take it in any direction you want and give the audience your sort of a little bit of your vision into how ESG fits into the ecosystem? Maybe we'll go in reverse order from the introduction. We'll kick it off with Hugo and give you a chance to speak.

Question: Judah Efram Sokel - JPMorgan Chase & Co, Research Division - Analyst : Okay, great. Martin, how do you see the market having changed over the past 5 years? And where do you see things going? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies.

Question: Judah Efram Sokel - JPMorgan Chase & Co, Research Division - Analyst : Okay. Great. Then Martina?

Question: Judah Efram Sokel - JPMorgan Chase & Co, Research Division - Analyst : It's great, well, that was really great. So I'm going to start off with a question for Hugo. How do you use the ESG scoring and rating services that are out there? There's many and I'm curious, I'm trying to understand how you use it from your -- in your role whether there's a market leader in your eyes. And really, generally, how important is it for a company to have a "good" ESG score, good ESG rating?

Question: Judah Efram Sokel - JPMorgan Chase & Co, Research Division - Analyst : Got it. The next question is for Martin. As being on the buy side, I'm curious, what are some best practices in terms of ESG integration that you see for an asset manager today? How has that evolved? And maybe what specific capabilities differentiate leaders in this ecosystem relative to the mainstream? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies.

Question: Judah Efram Sokel - JPMorgan Chase & Co, Research Division - Analyst : Makes a lot of sense. Martina, a question for you. We often just joined together these 3 letters. ESG, they just click together, but they're actually quite distinct, obviously. So how do you see the unique role of each one of these 3 components in the ecosystem? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies.

Question: Judah Efram Sokel - JPMorgan Chase & Co, Research Division - Analyst : Great. We've got about 5 minutes and we have so much to touch on. So maybe we could run through some of these questions. Hugo, I have a question. The U.S. is playing catch-up to Europe in terms of just understanding the importance of ESG and integration. So what do you view as the best practices that should really gain traction in the U.S. quickly amongst corporates? Is it ahead of sustainability? Is it corporate sustainability reports? Is it ESG rating? I'll let you respond. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies.

Question: Judah Efram Sokel - JPMorgan Chase & Co, Research Division - Analyst : Great. Got about 2 minutes. I want to try to sneak in a couple -- 2 more questions. So the first one is for Martin. Just in terms of ESG and the role of ESG in capital markets, it seems like IPOs are increasingly telling an ESG story these days that you sometimes find an ESG lens switching from risk mitigation to almost being a source of demand. I'm wondering what resonates the most in the buy side.

Question: Judah Efram Sokel - JPMorgan Chase & Co, Research Division - Analyst : Got it. There's so much more to talk about. I wanted to talk about reporting frameworks and maybe just the next frontier of excluded investments. But unfortunately, we are at the top of the hour, it definitely flew. And I want to thank each one of you, Martina, Martin, Hugo, for participating in this panel. And thank you to the audience for joining us well. I'm Judah Sokel, and thank you for attending the Ultimate Services Investor Conference. We'll see you in 2021, hopefully, in person.