Commitment in developing
and implementing Sustainable Development Goals
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Enhanced Financial Analysis

 

Enhanced Financial Analysis is the first advanced course to be released by the PRI Academy. The course explores and examines the use of sustainability data in fundamental investment analysis and stock valuation. In order to do so, the course, taking 6 – 8 hours to complete, works through a series of topics that help to identify the critical environmental, social and governance (ESG) issues relevant to sustainability performance, key value drivers, and overall financial outcomes.

The course aims to provide candidates with a detailed understanding of the place of sustainability in finance, and the role of ESG factors in financial decision making. Targeted at investment professionals, the course aims to build the skills necessary to identify new value drivers in financial analysis, and apply practical tools to modeling and stock valuation.

INTRODUCTION

  • Understand ESG information uses
  • Identify the role of intangible value drivers in investment decision making

THE CASE STUDY

  • Define integrated analysis
  • Identify the relationship between ESG data and materiality
  • Understand the basic concepts needed to identify factors most material financial value

STEP 1: IDENTIFY

  • Identify ESG factors in traditional sector analysis
  • Outline key environmental, social and business indicators that can impact financial value
  • Identify global trends and regulations and their impact on financial analysis
  • Map ESG factors in to hypothetical case studies
  • Measure the extent to which ESG issues will impact key financial metrics

STEP 2: ASSES AND ANALYSE 

  • Assess the degree to which ESG factors affect industry and company performance
  • Identify the guiding principles for assessing ESG issues
  • Assess ESG issues using risk mapping methodologies
  • Evaluate revenue, profit margins and operations using ESG data
  • Assess and rank companies according to key ESG factors

STEP 3: MODEL AND INTEGRATE

  • Understand the guiding principles of ESG integration
  • Examine a DCF model with an ESG overlay
  • Identify the entry points for ESG analysis in an EP model
  • Rank and score company performance
  • Recognise varying options of ESG analysis and integration

SOURCING ESG INFORMATION

  • Identify the range of ESG data available
  • Understand how to use multiple forms of ESG data
  • Recognise the challenges faced in collecting ESG data
  • Identify global initiatives, regulations and tools that support ESG integration
  • Understand the role of reporting

USING ESG INFORMATION

  • Identify the many uses for sustainability data
  • The role of ESG data in direct financial modelling

KEY PRINCIPLES

  • Recognise  and apply the key principles of ESG analysis

 

support


GRI
Global Reporting Initiative
CSRA
Certified Sustainability Reporting Assuror
Standards
GRI Standard & AccountAbility (AA1000)
PRIA
Principles for Responsible Invesment Academy