ESG 
as a workforce 
strategy
Part II: Methodology document

ESG as a Workforce Strategy
© Marsh & McLennan Companies 
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JOURNEY THROUGH  
OUR STUDY
The research question for our study was: what is the relationship between companies’ 
environmental, social, and governance (ESG) performance and their workforce sentiment? 
The workforce is defined as comprising both existing and prospective employees. We assume the 
workforce is generally aware of their current or prospective employer’s ESG performance, either due 
to explicit corporate communications or through an individual’s own research efforts in this area.
WORKFORCE SENTIMENT
In this study, we compared the ESG performance of employers with different workforce 
sentiment. Companies were categorized into three groups: 
•	 Global average employers
•	 Top employers by employee satisfaction 
•	 Top employers by attractiveness to students and young professionals
As illustrated in Exhibit A.1, available data proxies were used to group these companies 
accordingly.  
Employer group
Data proxy
Global average employers
Companies included in the MSCI ACWI Index
Top employers by employee satisfaction
Companies included in both:
•	 MSCI ACWI Index
•	 Fortune’s 2019 “100 Best Companies to Work For”
Top employers by attractiveness to students 
and young professionals
Companies included in both:
•	 MSCI ACWI Index
•	 Universum’s 2019 “World’s Most Attractive Employers”
Exhibit A.1: Selection criteria for each employer group

ESG as a Workforce Strategy
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ESG PERFORMANCE 
Three types of data from the MSCI ESG database (Exhibit A.2) were used to quantify the 
ESG performance of companies across the three employer groups and evaluate their ESG 
performance at different levels of granularity. 
The data points from levels 1, 2, and 3 in Exhibit A.2 were averaged for each employer group 
and then compared across employer groups. In this way, we evaluated the ESG performance of 
employers with differing workforce sentiments. 
Overall
 ESG score
COMPANY-LEVEL DATA POINT
DESCRIPTION
EXAMPLE
E, S, and G pillar scores
Underlying indicators within 
each E, S, and G pillar
An overall ESG score of 5.6
A Governance score of 4.8
1
3
Source: MSCI, Marsh & McLennan Advantage Insights analysis 
2
Represents a company’s performance
in the respective dimensions 
of Environmental, Social, 
and Governance criteria
Represents a company’s performance
on a specific issue in the Environmental,
Social, or Governance dimension
The proportion of female 
board members 
is 20 percent
Represents a company’s overall
aggregate ESG performance
Exhibit A.2: Types of MSCI ESG data points used for sample of employers

ESG as a Workforce Strategy
© Marsh & McLennan Companies 
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SELECTING OUR ESG AND 
WORKFORCE DATASETS
In our analysis, datasets were taken from four sources:
1. The MSCI ESG database: ESG scores and related data
The MSCI ESG database contains ESG scores and related data for more than 7,500 companies 
around the world.
MSCI measures a company’s ESG performance, in the form of ESG scores and ratings, based 
on the MSCI ESG Ratings methodology. This methodology is designed to identify the most 
significant environmental, social, and governance risks and opportunities for each industry and 
provides an overall rating based on companies’ exposure to and management of those risks and 
opportunities. 
MSCI’s overall ESG scores for each company, shown as level 1 in Exhibit A.2, represent the 
industry-adjusted weighted average of a company’s E, S, and G pillar scores. This industry 
adjustment ensures that a company is evaluated against the standards and performance of its 
industry peers. The resulting score ranges from 0 to 10, with 0 being the worst and 10 being the 
best; this corresponds to an ESG rating between CCC (worst) and AAA (best). 
MSCI’s E, S, and G pillar scores for each company, represented as level 2 in Exhibit A.2, are 
derived from the weighted average of issue scores, which are calculated based on the results of 
the underlying ESG indicators.
Data for the underlying indicators within each pillar, shown as level 3 in Exhibit A.2, are 
comprised of raw data collected by MSCI. We used these underlying indicators to further 
evaluate a company’s performance on specific issues within each pillar, allowing us to analyze 
the more granular relationship between specific ESG issues and workforce sentiment. Underlying 
ESG indicators were selected for analysis based on the following criteria:
•	 Transparency: An issue for which information is available to current and prospective 
employees
•	 Universality: An issue that is applicable across all industries 
•	 Measurability: An issue that is measurable and, therefore, comparable between companies
As a result, the following indicators for analysis were chosen (Exhibit A.3):

ESG as a Workforce Strategy
© Marsh & McLennan Companies 
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Environmental
Social
Governance
ESG indicator
Carbon emission intensity
Employer effort in 
monitoring employee 
satisfaction
Percentage of female board 
members
Description 
A calculation representing 
a company's most recently 
reported or estimated Scope 
1 + Scope 2 greenhouse gas 
emissions normalized by 
sales in USD, which allows 
for comparison between 
companies of different sizes
A 0 to 10 score indicating 
the strength of a company’s 
initiatives to monitor 
employee satisfaction 
through mechanisms such as 
regular engagement surveys, 
open door policies, etc.
The percentage of board 
members who are female. 
For companies with a two-
tier board, the calculation is 
based on members of the 
Supervisory Board only.
Example
A company emits 50 metric 
tons of carbon per US$ 
million in sales.
A company has a score of 6.2 
for its efforts in monitoring 
employee satisfaction.  
A company’s proportion of 
female board members is 30 
percent.
Source: MSCI, Marsh & McLennan Advantage Insights analysis
2. The MSCI ACWI Index: Global average employers
The MSCI ACWI index represents the performance of large- and mid-cap publicly listed companies 
across 23 developed and 26 emerging markets. As of fourth quarter 2019 when we conducted 
our analysis, the index covered more than 2,700 companies across 11 sectors and approximately 
85 percent of the free float-adjusted market capitalization in each covered market. The index is 
commonly used as a benchmark to evaluate the overall performance of the global stock market. 
To represent global average employers, we chose companies that both:
•	 Were included in the MSCI ACWI index
•	 Had ESG data available as part of the MSCI ESG database
This resulted in a study sample of 2,764 companies, representing global employers. For the 
selected sample, three levels of ESG data were extracted from the MSCI ESG database as of 
October 2019: Aggregate ESG scores; E, S, and G pillar scores; and the three underlying ESG 
indicators (Exhibit A.2). 
3. Fortune’s “100 Best Companies to Work For”: Top employers by employee satisfaction
Fortune’s “100 Best Companies to Work For” is a list featured annually in Fortune magazine. Most 
of the evaluation (85 percent) is based on employee responses to a 60-question survey created 
by people analytics firm Great Place to Work. The survey covers topics such as employees’ 
experiences of trust and reaching their full potential as part of their organization. The remaining 
15 percent of the evaluation is based on Great Place to Work’s assessment of factors such as 
employees’ daily experiences of the company’s values, people’s ability to contribute new ideas, 
and the effectiveness of company leaders. To prevent any potential bias, Fortune is not involved 
in the employer evaluation process.
From our 2,764-company sample of employers, 33 are included in Fortune’s 2019 “100 Best 
Companies to Work for” list.
Exhibit A.3: Underlying ESG indicators chosen for analysis

ESG as a Workforce Strategy
© Marsh & McLennan Companies 
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4. Universum’s “World’s Most Attractive Employers”: Top employers by attractiveness  
to young talent
The “World’s Most Attractive Employers” is an annual study conducted by market research firm 
Universum, based on the survey responses of hundreds of thousands of college students from 
the world’s largest economies. Based on the survey results, Universum each year releases two 
ranked lists of the “Top 50 World’s Most Attractive Employers”, one from business students and 
the other from engineering/IT students. The rankings chart the success of individual companies’ 
talent-attraction efforts and document students’ shifting ideas about what defines  
an ideal employer.
For the 2019 “World’s Most Attractive Employers” ranking, Universum surveyed 247,235 business, 
engineering, and IT students in the world’s 12 largest economies, and asked two questions:1 
•	 Which employer characteristics are most influential as you consider future employment?
•	 Which employer brands do you most admire?
From our 2,764-company sample of employers, 55 are included in Universum’s “World’s Most 
Attractive Employers” lists.
1	  Universum conducted their 2019 survey in Brazil, Canada, China, France, Germany, India, Italy, Japan, Russia, South Korea,  
 the UK, and the US.

ESG as a Workforce Strategy
© Marsh & McLennan Companies 
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RECOGNIZING OUR 
LIMITATIONS
As with other research studies, limitations exist due to constraints on research design, 
methodology, or data availability at the point of study. Here we discuss the limitations in 
our research with the hope that future researchers can consider these when undertaking 
similar studies:
•	 Our study assessed companies’ ESG performance using ESG scores from the MSCI ESG 
database. We recognize, however, that ESG data providers each have a unique methodology 
for calculating company ESG scores – and a company’s score from one data provider often 
differs from that of other providers. Therefore, for more robustness, it would be valuable for 
future researchers to include ESG data from multiple data providers when conducting the 
same analysis.
•	 To quantify workforce sentiment, our study categorized companies into top employers  
– either by employee satisfaction or attractiveness to young talent – and average 
employers. As such, the workforce sentiment variable in our study was categorical rather 
than continuous, potentially obscuring any more granular trends. It would be valuable for 
future researchers to quantify a company’s workforce sentiment on a continuous scale, 
thus assessing if the relationship we observed between ESG performance and workforce 
sentiment is continuous.
•	 Our study did not control for other variables that may affect workforce sentiment, such as 
country GDP, company size, and company revenue, among others. It would be valuable for 
future researchers to control such variables and thus further evaluate the relationship we 
observed between ESG performance and workforce sentiment.

To explore the interactive results of the  
ESG as a Workforce Strategy please visit our website
AUTHORS
Lingjun Jiang
Research Analyst,
Marsh & McLennan Advantage, Insights
lingjun.jiang@oliverwyman.com
Angela Ferguson
Research Analyst,
Marsh & McLennan Advantage, Insights
angela.ferguson@oliverwyman.com
Jaclyn Yeo
Research Manager,
Marsh & McLennan Advantage, Insights
jaclyn.yeo@oliverwyman.com
Rob Bailey
Director, Climate Resilience,
Marsh & McLennan Advantage, Insights
rob.bailey@oliverwyman.com
	
INDUSTRY CONTRIBUTORS
MSCI Inc.: Jackie Daitchman
We would like to thank MSCI for providing the ESG data used in our analysis.
MARSH & MCLENNAN COMPANIES CONTRIBUTORS
Mercer:  
Adam Pressman, Chris Labrecque, Daniel Imbeault, Haig Nalbantian, Peter Rutigliano
Marsh & McLennan Advantage:  
Alex Bernhardt, Hilary Pereira, Lily Phan, Richard Smith-Bingham, Sham Majid
The design work for this report and the accompanying interactive website was led by 
Agata Gumolka, Karolina Kot, and Agnieszka Lasinkiewicz.
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