FinanceMap scores this financial institution in the following areas. Please navigate to the relevant tab for in-depth analysis
FinanceMap assesses these portfolios for this financial institution. Please navigate to the relevant tab for in-depth analysis.
Portfolio Paris Alignment analysis of this institution's activities in this portfolio area in 2020–2021.
Value Assessed: $194B
Sector Paris Alignment scores for the sectors to which this portfolio has exposure. FinanceMap Paris Alignment analysis is limited to the automotive, upstream fossil fuel, and power sectors.
Portfolio Paris Alignment analysis of this institution's activities in this portfolio area in 2020–2021.
Value Assessed: $249B
Sector Paris Alignment scores for the sectors to which this portfolio has exposure. FinanceMap Paris Alignment analysis is limited to the automotive, upstream fossil fuel, and power sectors.
Portfolio Paris Alignment analysis of this institution's activities in this portfolio area in 2020–2021.
Value Assessed: $220B
Sector Paris Alignment scores for the sectors to which this portfolio has exposure. FinanceMap Paris Alignment analysis is limited to the automotive, upstream fossil fuel, and power sectors.
Fossil fuel production companies are defined as those with primary sector of operations in the up-, mid-, and/or downstream segments of fossil fuel production. Green companies are defined as companies having over 75% revenue deriving from Substantial Contribution to Mitigation activities under the EU Taxonomy.
Portion of AUM Assessed: $154B
Sector Paris Alignment scores for the sectors in which the asset manager has shareholdings. FinanceMap Paris Alignment analysis is limited to the automotive, upstream fossil fuel, and power sectors.
| Holding Name | Contribution to Sector Production |
|---|---|
| Nextera Energy Inc | 19.2% |
| Duke Energy Corp | 15.7% |
| Iberdrola SA | 8.0% |
| American Electric Power Company Inc | 5.8% |
| Enel SpA | 5.7% |
| Xcel Energy Inc | 3.8% |
| CMS Energy Corp | 3.1% |
| Enel Chile SA | 3.0% |
| Entergy Corp | 2.7% |
| NRG Energy Inc | 2.4% |
| Holding Name | Contribution to Sector Production |
|---|---|
| Ford Motor Co | 22.5% |
| Stellantis NV | 21.0% |
| General Motors Co | 11.3% |
| Maruti Suzuki India Ltd | 9.3% |
| Kia Corp | 5.3% |
| Tesla Inc | 4.6% |
| Toyota Motor Corp | 4.1% |
| Mahindra and Mahindra Ltd | 3.5% |
| BYD Co Ltd | 3.2% |
| Hyundai Motor Co | 2.3% |
| Holding Name | Contribution to Sector Production |
|---|---|
| China Shenhua Energy Co Ltd | 49.2% |
| Glencore PLC | 13.4% |
| Yankuang Energy Group Co Ltd | 8.8% |
| Exxaro Resources Ltd | 6.1% |
| Adaro Energy Indonesia TBK PT | 5.1% |
| Peabody Energy Corp | 4.3% |
| Arch Resources Inc | 2.7% |
| Coal India Ltd | 1.9% |
| Semirara Mining and Power Corporation | 1.4% |
| Bukit Asam Tbk PT | 1.4% |
| Holding Name | Contribution to Sector Production |
|---|---|
| Exxon Mobil Corp | 20.6% |
| Chevron Corp | 13.0% |
| Antero Resources Corp | 11.4% |
| Conocophillips | 10.4% |
| EOG Resources Inc | 9.6% |
| Petroleo Brasileiro SA Petrobras | 7.6% |
| EQT Corp | 5.9% |
| Range Resources Corp | 5.0% |
| Occidental Petroleum Corp | 2.7% |
| Diamondback Energy Inc | 1.8% |
All equity funds that FinanceMap has identified as being managed by this asset manager. Click through to a fund's profile page to view in-depth analysis.
Morgan Stanley is engaging with companies around climate change, but it does not appear to be a strong engager. While climate risk and decarbonization have been listed as engagement priorities of MSIM, it does not have a clear overarching framework for climate engagements. However, one of its investment teams does have a robust framework for engagements with companies in the oil and gas sector. The asset manager does not appear to use milestones but does track and monitor engagement progress. It has defined a clear escalation response as well as provided examples of escalation activities.
Morgan Stanley does appear to be actively engaging companies on climate change. For example, it has engaged with a US global transportation provider on carbon accounting and ESG reporting, as well as with a South African paper company on its emissions reduction targets which led the company to implement measures that saw results in Scope 1 and 2 emissions. The asset manager does not appear to have a firm-wide strategy on climate policy influence, but some of its subsidiaries and integrated investment teams have engaged with companies on climate lobbying. Additionally, it is a member of several climate-related investor initiatives.
MSIM has clearly described its stewardship governance structures and appears to review its Engagement and Stewardship principles at least once a year. The asset manager does provide anonymous case studies but does not disclose the names of any companies it has engaged with. It is transparent about voting activities, and discloses all proxy voting data along with voting rationale on its website. The asset manager does not appear to have used shareholder authority to engage companies on climate.
Insightia data suggests that Morgan Stanley has mixed support of AGM resolutions InfluenceMap categorizes as in line with the Paris Agreement, supporting 29.8% in 2019, 43.1% in 2020, 51.2% in 2021, and 46.3% in 2022.
FinanceMap's methodology to measure the engagement process on climate was developed in consultation with several of the world's leading asset managers and uses key aspects of the UK Financial Reporting Council's 2020 Stewardship Code . The Stewardship Code was chosen to benchmark engagement quality as it provides an ambitious framework and detailed definitions of what constitutes effective engagement. FinanceMap defines the term ‘engagement’ as referring to all investor actions undertaken to influence the management strategy of the companies they own including private communications with corporate management and appointed advisors; questions at AGMs/other company meetings; comments on the company in the media; escalation and the shareholder resolution process (filing, voting behavior). FinanceMap’s methodology breaks the engagement process down into a set of sub-activities and looks for evidence associated with these across publicly available data sources.
Climate-relevance categorization of shareholder resolutions is based on the IPCC’s Special Report on 1.5°C and its concluded need for “rapid and far-reaching transitions in land, energy, industry, buildings, transport, and cities.” FinanceMap scored voting on any resolution where the intent and likely outcome is consistent with this IPCC stated need. The voting data is drawn from asset managers' disclosures to the US Security Exchange Commission (SEC), asset manager websites (including third-party websites they link to), directly from the asset managers, and through specialist voting data provider Insightia. The full list of resolutions assessed is available here.
The following table outlines the key queries and data sources, which FinanceMap uses to assess financial institutions’ sustainable finance policy engagement. Every evidence piece is assessed on a five-point scale of -2,-1,0,1,2 or NA (not applicable)/NS (not scored). All queries, data sources, and evidence pieces are weighted against one another in a matrix system to arrive at a final top-level score. Clicking on specific cells will load the underlying evidence and information on how it has been assessed.
Morgan Stanley appears to have had moderate engagement on sustainable finance policy, with some broadly positive engagement coming from its asset management subsidiary Calvert Research and Management.
Morgan Stanley has recognized the issue of short-termism but it is unclear whether it supports systemic reforms to address this. Morgan Stanley has stated support for action to keep global temperature rise to 1.5C and advocated for a role for finance in delivering the goals of the Paris Agreement. In testimony to the Senate Banking Committee in 2021, CEO James Gorman recognized the “urgent need to address the climate challenge.” Reports across Morgan Stanley’s website describe ongoing sustainable finance regulation but it is often unclear whether Morgan Stanley supports this regulation.
In 2021, Morgan Stanley Investment Management signed onto a statement of support for the EU Corporate Sustainability Reporting Directive (CSRD), advocating for policymakers to increase the ambition of regulated corporate ESG disclosure. However, a September 2022 memo regarding a meeting between banks and the Securities and Exchange Commission (SEC) suggests that Morgan Stanley does not support aspects of the SEC’s proposed climate disclosure rule, outlining concerns with implementation and cost. Calvert Research and Management has also engaged on the SEC’s climate rule, supporting the proposal including its financial statement and Scope 3 disclosure requirements. Calvert took a more mixed position on the International Sustainability Standards Board’s proposed climate disclosure standards, not supporting mandatory scenario analysis disclosure.
While Morgan Stanley has taken a somewhat unclear position on the EU Taxonomy on its corporate website, a 2020 case study and a 2021 news article suggest support for the Taxonomy. In the same 2021 news article, Morgan Stanley appears to support the EU Green Bond Standard. In comments to the SEC in 2022, Calvert Research and Management stated support for the Commission’s efforts to classify ESG-related funds but did not support an extension of the Commission’s ‘Names Rule’ and its 80% investment policy to ESG-related funds.
In 2022, Calvert Research and Management took a mixed position on the SEC’s proposal to enhance disclosures by investors about their ESG investment practices, supporting qualitative disclosure about a fund’s approach to proxy voting and engagement but asserting that quantitative reporting should be voluntary, and advocating for Scope 3 disclosure requirements to be delayed.
In a 2021 insights article Morgan Stanley appeared to support efforts to incorporate climate into central banks’ operational frameworks, and in its 2021 CDP response Morgan Stanley stated support for the UK Prudential Regulation Authority’s efforts to incorporate climate risks into banks’ and insurers’ governance and risk management.
Morgan Stanley has disclosed memberships to some US trade associations but has not given a comprehensive disclosure on the sustainable finance policy positions of these organizations or actions taken to address misalignments. Memberships to, for example, EU trade associations are not disclosed.
InfluenceMap’s methodology for assessing lobbying on sustainable finance policy closely follows InfluenceMap’s established methodology on climate policy engagement, which is used extensively by investors, including via the Climate Action 100+ investor engagement process. Our full methodology can be found here.
Under our assessment of sustainable finance lobbying, InfluenceMap considers engagement on all financial policies which intersect with climate and/or other sustainability issues. The analysis takes into account both the engagement of the financial institution and the activities of industry associations they hold membership of.
InfluenceMap’s methodology covers seven publicly available data sources, searching for evidence of engagement and corporate positioning since 2017. To determine the policy issues within the scope of the analysis, InfluenceMap breaks down sustainable finance policy engagement into a series of subcategories, or 'queries'. These are designed to cover high-level issues relating to the importance of sustainable finance, as well as more specific areas of sustainable finance policymaking. InfluenceMap’s research process searches for evidence of an organization's engagement with each sustainable finance policy issue, across each of the data sources.
The following table outlines the key queries and data sources, which FinanceMap uses to assess asset managers' corporate engagement programs. Every evidence piece is assessed on a five-point scale of -2,-1,0,1,2 or NA (not applicable)/NS (not scored). All queries, data sources, and evidence pieces are weighted against one another in a matrix system to arrive at a final top-level score. Clicking on specific cells will load the underlying evidence and information on how it has been assessed.
In this section, we depict graphically the relationships the corporation has with trade associations, federations, advocacy groups and other third parties who may be acting on their behalf to influence climate change policy. Each of the columns above represents one relationship the corporation appears to have with such a third party.
In these columns, the top, dark section represents the strength of the relationship the corporation has with the influencer. For example if a corporation's senior executive also held a key role in the trade association, we would deem this to be a strong relationship and it would be on the far left of the chart above, with the weaker ones to the right. Click on these grey shaded upper sections for details of these relationships. The middle section contains a link to the organization score details of the influencer concerned, so you can see the details of its climate change policy influence. Click on the middle sections for for details of the trade associations. The lower section contains the organization score of that influencer, the lower the more negatively it is influencing climate policy.
InfluenceMap Data Point on Corporate - Influencer Relationship
Morgan Stanley & Co. International PLC is a member of UK Finance
InfluenceMap Data Point on Corporate - Influencer Relationship
David Best is on the board of UK Finance
David Best (Managing Director and Deputy Chief Operating Officer for EMEA)
InfluenceMap Data Point on Corporate - Influencer Relationship
Morgan Stanley & Co. International PLC is a member of UK Finance
InfluenceMap Data Point on Corporate - Influencer Relationship
David Best is on the board of UK Finance
David Best (Managing Director and Deputy Chief Operating Officer for EMEA)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Davide Menini is on the AFME board
Davide Menini (Managing Director, Global Head of Fixed Income Structuring and Structured Notes Trading, Fixed Income Division)
--no extract--
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Davide Menini is on the AFME board
Davide Menini (Managing Director, Global Head of Fixed Income Structuring and Structured Notes Trading, Fixed Income Division)
--no extract--
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Edward (Ted) Pick is on the board of the IIF as of July 2022
Edward (Ted) Pick, Co-President & Head of Institutional Securities Group, Morgan Stanley
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Morgan Stanley is a member of the IIF
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Edward (Ted) Pick is on the board of the IIF as of July 2022
Edward (Ted) Pick, Co-President & Head of Institutional Securities Group, Morgan Stanley
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Morgan Stanley is a member of the IIF
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Morgan Stanley is a member of ICI
not specified
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Thomas Faust Jr. is on the Board of ICI
Thomas E. Faust Jr. (Chairman, Morgan Stanley Investment Management)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Morgan Stanley is a member of ICI
not specified
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Thomas Faust Jr. is on the Board of ICI
Thomas E. Faust Jr. (Chairman, Morgan Stanley Investment Management)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Samuel Brandwein is a member of the ARA board of directors, with a term ending December 2023)
Samuel Brandwein (Senior Vice President and 401k Consulting Director, Morgan Stanley)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Samuel Brandwein is a member of the ARA board of directors, with a term ending December 2023)
Samuel Brandwein (Senior Vice President and 401k Consulting Director, Morgan Stanley)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Morgan Stanley is a member of SIFMA
not specified
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Andy Saperstein is on the board of SIFMA.
Andy Saperstein (Co-President of Morgan Stanley and Head of Morgan Stanley Wealth Management)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Morgan Stanley is a member of SIFMA
not specified
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Andy Saperstein is on the board of SIFMA.
Andy Saperstein (Co-President of Morgan Stanley and Head of Morgan Stanley Wealth Management)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
As of August 2022, Morgan Stanley is on the board of the MFA
Penny Novick (Global Co-Head, Prime Brokerage)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Morgan Stanley is a strategic partner of the MFA
not specified
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
As of August 2022, Morgan Stanley is on the board of the MFA
Penny Novick (Global Co-Head, Prime Brokerage)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Morgan Stanley is a strategic partner of the MFA
not specified
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
As of October 2022, James Gorman is a member of the Financial Services Forum.
James Gorman (Chairman and CEO, Morgan Stanley)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
As of October 2022, James Gorman is a member of the Financial Services Forum.
James Gorman (Chairman and CEO, Morgan Stanley)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Alberto Tamura is on the board of the Chamber's US-Japan Business Council.
Alberto Tamura (President & CEO, Morgan Stanley Japan Holdings Co., Ltd)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Morgan Stanley is a member of the Chamber's US-Turkey Business Council.
not specified
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Clare Woodman is the Chair of the Chamber's US-UK Business Council.
Clare Woodman (Head of EMEA and CEO of Morgan Stanley and Co. International Plc)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Morgan Stanley is a member of the US Chamber of Commerce
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Alberto Tamura is on the board of the Chamber's US-Japan Business Council.
Alberto Tamura (President & CEO, Morgan Stanley Japan Holdings Co., Ltd)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Morgan Stanley is a member of the Chamber's US-Turkey Business Council.
not specified
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Clare Woodman is the Chair of the Chamber's US-UK Business Council.
Clare Woodman (Head of EMEA and CEO of Morgan Stanley and Co. International Plc)
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
Morgan Stanley is a member of the US Chamber of Commerce
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
As of November 2022, Morgan Stanley is a member of UK Finance which is a national member association of the EBF
not specified
--no extract--
InfluenceMap Data Point on Corporate - Influencer Relationship
(1 = weak, 10 = strong)
As of November 2022, Morgan Stanley is a member of UK Finance which is a national member association of the EBF
not specified
--no extract--
InfluenceMap Data Point on Corporate - Influencer Relationship
Morgan Stanley Investment Management and Morgan Stanley Investment Partners are members of the Investment Association which is a national association member of the EFAMA
not specified
InfluenceMap Data Point on Corporate - Influencer Relationship
Morgan Stanley Investment Management and Morgan Stanley Investment Partners are members of the Investment Association which is a national association member of the EFAMA
not specified
Morgan Stanley board committees have regular oversight of climate-related risks as well as ESG initiatives and sustainability reporting. They have incorporated climate-related issues into corporate strategy and internal policy reviews, for example, through announcing its net-zero ambitions in September 2020 and joining the Net Zero Banking Alliance as a founding signatory in April 2021. Management-level positions and committees are assigned clear climate-related responsibilities, and there are processes in place to ensure they monitor the progress of climate-related issues and initiatives.
Morgan Stanley considers climate-related risks and opportunities on its lending, advisory, and investment business activities and references some processes to determine which risks and opportunities could have material financial impact on the organization. It considers different types of transition and physical risks, however, it is unclear if it considers climate-related risks and opportunities over different time horizons.
Moran Stanley is transparent about how it considers climate-related risks and opportunities in its business planning. For example, it is mobilizing low-carbon solutions across wealth management, investment management, and institutional securities business lines and is working towards climate-resilient operations.
The organization has conducted pilot climate-related stress testing across various climate scenarios, including two transition scenarios on a sample oil and gas portfolio and a physical scenario to assess firm exposures by geography. However, it does not appear to have tested its business strategy using a 2°C or lower warming climate scenario or across other business areas.
Morgan Stanley appears to incorporate climate-related risks into assessments of six risk categories. It describes its risk management processes for identifying and assessing climate-related risks, explaining its risk management approach is broken down into four categories: risk identification, exposure calculation, scenario design, and risk appetite.
It also highlights various processes in place to manage climate-related risks. Its ESRM policy statement guides the firm’s risk management process, including sector and cross-sector due diligence approaches and an escalation strategy. The organization’s BCM teams are responsible for evaluating and preparing for climate-related risks related to direct operations.
The organization appears to have integrated climate-related risks into its overall risk management. For example, Morgan Stanley has integrated climate change into the firm’s risk management processes for its lending and operations and sector-specific policies.
Morgan Stanley's disclosure of metrics to measure and manage climate-related risks and opportunities appears to be limited to its emissions. It is transparent about Scope 1 and Scope 2 emissions data and has some Scope 3 emissions disclosure such as business travel. It does not currently disclose around financed emissions but has been engaging with numerous initiatives, including PACTA and PCAF.
In September 2020, Morgan Stanley announced a target to achieve net-zero financed emissions by 2050. In April 2021, the bank was announced as a founding member of the UN convened Net Zero Banking Alliance. In November 2021, the bank set its initial 2030 interim targets covering three sectors including auto manufacturing, energy, and power and outlined a methodology to measure and manage these targets.
The organization is not aligned with IPCC guidance on the role of coal in the energy mix up to 2050. Morgan Stanley has prohibited certain transactions including the development of new or physical expansions of coal-fired power generation unless CCS (or equivalent technology) is deployed as well as mountaintop removal mining and new thermal coal mine development. However, it appears to otherwise provide financing for expanding coal mining capacity and coal power capacity given due diligence.
With regard to natural gas and oil, Morgan Stanley applies enhanced due diligence for activities related to oil sands, Arctic oil and gas exploration and development, ultra-deepwater oil and gas, shale oil and gas, and oil and gas pipelines. The organization has prohibited financing of new Arctic oil and gas exploration and development but appears to provide financing for other oil and gas activities assuming clients meet due diligence.
It appears that Morgan Stanley is advocating a position that is partially aligned with IPCC guidance on the role of nuclear in the energy mix. When providing financing, the organization requires enhanced due diligence to ensure clients meet international safety standards.
Moreover, the organization has communicated support for a low-carbon economy and has committed "$1Trillion to Support Sustainability Solutions by 2030, including $750 Billion of Low-Carbon Solutions".
FinanceMap’s Climate Governance and Policies analysis assesses statements financial institutions (FIs) are making on how they are incorporating climate issues into their decision-making and operations using FinanceMap’s matrix methodology. This methodology is adapted from the Task Force on Climate-Related Financial Disclosures (TCFD) recommendations and guidelines, Net-Zero Banking Alliance (NZBA) or equivalent Glasgow Financial Alliance for Net-Zero (GFANZ) initiative reporting, and IPCC and IEA technology statements. The TCFD provide guidance on 11 recommendations across four areas which are reflected in our matrix: Governance, Strategy, Risk Management, and Metrics and Targets. Additional benchmarks have been introduced to strengthen the ambition of scoring criteria in the assessment of targets, which are supplemented by guidance from the NZBA or equivalent GFANZ initiatives.
Additionally, Science-Based Policy (SBP) benchmarks are used to measure alignment of an FIs technology positions with the science of climate change. These benchmarks are applied to an FIs internal policies on technologies including coal, oil, gas, nuclear, and renewables and also assesses its engagement with broader climate and energy policy issues such as advocacy on the role and importance of different strategy types in the future energy mix.
For each TCFD recommendation and technology, FIs statements are applied to a five point scoring scale ranging from +2 to -2, measuring alignment with the relevant benchmarks. The detailed scores for this FI are displayed below within each matrix cell.
The following table outlines the key queries and data sources, which FinanceMap uses to assess financial institutions climate governance, targets and policies. Every evidence piece is assessed on a five-point scale of -2,-1,0,1,2 or NA (not applicable)/NS (not scored). All queries, data sources, and evidence pieces are weighted against one another in a matrix system to arrive at a final top-level score. Clicking on specific cells will load the underlying evidence and information on how it has been assessed.
Open PDF file of Data Source