Fimalac launches CoreRatings

Fimalac launches CoreRatings Fimalac, owner of Fitch Ratings, enters the corporate responsibility sector with the launch of CoreRatings, a global ratings agency.

Corporate governance, environmental & product liabilities and social responsibility have all become key issues for companies and investors. CoreRatings will issue company ratings based on an assessment of the investment impact of the risks companies are running across these key areas of their operations, and provide investors and the financial community with the tools to analyse the risks.

CoreRatings has been formed by the management of two of Europe’s leading corporate responsibility research companies, London-based Global Risk Management (founded in 2000) and Paris-based Arese (founded in 1997). Fimalac has bought Global Risk Management which is run by Alan Banks and he has been joined by Genevieve Ferone, the founder and ex-President of Arese, and a number of her key research staff.

CoreRatings, which has 30 staff in offices in London, Paris and Madrid, already provides detailed qualitative risk analyses on more than 1,000 companies to many of Europe’s leading investment groups including Barclays Global Investors, Dresdner RCM and ABN Amro. CoreRatings is also a leading provider of research to many private and public pension schemes.

CoreRatings products include Research, Corporate Ratings, and Engagement Services (structuring and facilitating active dialogue between companies and their investors on key risks and impacts). The products are used by equity and debt investors, lending banks, new issue underwriters, and the insurance industry to help in understanding investment and project risk and in valuing shares, bonds and other capital assets.

CoreRatings research methodology takes a very broad view of company performance, including such areas as: Management culture; longevity of intangible values; future liability to class actions from product, environmental or social damage; long-term access to people skills; and collateral reputation risk. All these areas have a direct effect on the risk premium required by investors to hold the financial assets of these companies.

Tauni Brooker, Programme Manager at the World Business Council for Sustainable Development and former Managing Director of the Dow Jones Sustainability Group Indexes, joined CoreRatings as Managing Director with responsibility for developing corporate ratings.

Marc Ladreit de Lacharriere, President of Fimalac, said:

" We are delighted to have acquired the key staff of Europe’s two best SRI research and ratings companies. The analyses done by CoreRatings are far advanced compared to any competitors’ and are complementary to the credit risk assessments carried out by Fitch Ratings.This is an interesting initiative for Fimalac, and we will be growing the company both organically and through acquisitions."

Alan Banks, Group CEO of CoreRatings, said:

"We have been looking for a partner to help us to develop our global investment risk rating product, and Fimalac is a thoughtful, long-term and committed shareholder. By putting together Fitch’s understanding of the ratings process and our experience of qualitative risk assessment we will be able to build quickly this additional service to the investment community and providers of long-term capital and risk products. We have a talented and experienced team in place, a substantial client base, an established methodology, and an extensive knowledge of global companies."

Genevieve Ferone, President of CoreRatings (Paris), added:

"At Arese we built the leading SRI research product for the French investment market. We also carried out solicited ratings of a number of major companies. It was our ambition to extend this ratings service to companies globally. At CoreRatings, and with the support of both Fimalac and Fitch Ratings, we have this opportunity. CoreRatings has the most highly regarded expertise in this area; it is an international company with a global view and I am very excited to be part of the project."