Experian, a provider of data services, has announced the debut of ESG Insight, a new product designed to provide lenders with a comprehension of ESG risk within their SME portfolios.
The new tool gives estimates of greenhouse gas (GHG) emissions, broken down by Scopes 1, 2, and 3, as well as social impact and governance ratings for the four million small and medium-sized enterprises (SMEs) in the United Kingdom.
The solution uses a variety of data, such as expected energy usage, number of employees at sites, and percentage of employees that commute by automobile, to build a business emissions picture.
The new service, according to Experian, is being introduced as regulators enforce requirements for lenders to understand the climate and broader ESG risk of their SME customers. It provides an alternative to requiring SMEs to undergo full emissions assessments or relying on sector-wide emissions averages.
The Managing Director of Experian Business Information, James McGarva, stated:
"ESG Insight gives a significantly more comprehensive perspective of emission projections, as well as social impact and governance ratings so that lenders can confidently baseline, report, and target activities to mitigate the climate risk associated with any SME portfolio. We are thrilled that our most recent innovation is contributing to the global effort to combat climate change."