2022 TCFDREPORT
Our role in sustaining the planet

MSCI: COMMITTED
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2022 TCFD REPORTThis report contains information about MSCI. This information may include estimates, projections andstatements relating to our business plans, objectives or expected operating results and statements regarding
corporate responsibility-related plans and goals that are “forward-looking statements” within the meaning of
the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934. In
some cases, you can identify forward-looking statements by the use of words such as “may,” “could,” “expect,”“intend,” “plan,” “seek,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” or the negative of
these terms or other comparable terminology. In evaluating these statements, you should consider various
factors, including the risks and uncertainties we describe in the “Risk Factors” sections of our Annual Reports
on Form 10-K and Quarterly Reports on Form 10-Q and other reports we file with the Securities and Exchange
Commission (“SEC”). You should not place undue reliance on forward-looking statements because they involve
known and unknown risks, uncertainties and other factors that are, in some cases, beyond our control and that
could materially affect our actual results, levels of activity, performance or achievements.
You should not place undue reliance on forward-looking statements, which speak only as of the date they are
made. We do not undertake to update or revise any forward-looking statements except as required by law.
The inclusion of information in this report regarding climate opportunities and risks should not be construed
as a characterization regarding the materiality or financial impact of that information with respect to MSCI.
For additional information regarding MSCI, please see our current and periodic reports with SEC, including our
Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q. Given the inherent uncertainty in predicting
and modeling future conditions, caution should be exercised when interpreting the information provided.

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Contents
MSCI: COMMITTED
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04
What we are doing as a company

04

Tools for climate action05

BACKGROUND

06
TCFD

GOVERNANCE

07
Board, Executive and Management Oversight

07

MSCI’s Climate Governance

08

STRATEGY

10MSCI’s climate-related risks and opportunities

10

The impact of climate-related risks and opportunities

19
23

Resilience of MSCI’s strategy under different climate scenarios

28

RISK MANAGEMENTMETRICS
AND TARGETS

06

MSCI’s processes for identifying and assessing climate-related risks

28

MSCI’s processes for managing climate-related risks

29

How climate-related risks are integrated into the organization’s overall risk management29
30

Metrics used to assess climate-related risks and opportunities

30

MSCI’s greenhouse gas (GHG) emissions

31

MSCI’s carbon-reduction targets

33

FORTIFYINGOUR PLEDGE

34

TCFD
GUIDELINES INDEX35

APPENDIX

39
Board oversight

39

Office and data center locations

42

Climate VaR Model

44

MSCI employee headcount in physical offices

46

Physical Risk charts

47

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04

MSCI: Committed
to Climate Action
MSCI’s approach to climatechange reflects both theprofound risks and numerous
opportunities it presents forour society and economy.

Preventing the worst effects of a warming climate is the defining challenge of our time.
While government action will be critical to reducing greenhouse gas emissions to netzero, companies, investors and society at large will need to do their part as well.
This report, which adopts the recommendations of the Task Force on Climate-related
Financial Disclosures (TCFD), details how MSCI takes climate change into accountin managing our own company. It aims to provide visibility into our support forenvironmental sustainability and how we are working to address climate-related risks
and opportunities.
As leaders of a public company that has called upon capital markets participants to
help drive the transition to an economy that removes as much greenhouse gas from theatmosphere as it puts in, and that provides solutions designed to help investors makeclimate change part of their strategies, we strive to be transparent in how we seek toreduce our own carbon footprint. MSCI is determined to lead by example.

WHAT WE ARE DOING AS A COMPANY
We continue taking steps to further integrate climate-related risks and opportunities
into our business. MSCI committed to reach net-zero emissions before 2040 throughout
our value chain and filed an enhanced near-term target with the Science Based Targets
initiative (SBTi), an independent arbiter of corporate climate pledges, for verification.
The target is to reduce our Scope 1 and 2 emissions by 80% by 2030 and our Scope 3
emissions by 50% over the same period.
In the past year, MSCI accelerated initiatives to reduce our overall environmental
impact. We have continued to increase the use of renewable energy at our offices
and decrease our commuting footprint by moving to hybrid work and implementing
policies to promote the use of rail and other environmentally friendly alternatives forbusiness travel.
We intensified efforts to drive down emissions within our supply chain — the sourceof 78% of our greenhouse gas emissions in 2021— by developing a sustainable suppliermanagement program to fully integrate climate considerations into our supplierselection and to prioritize our spend with supportive suppliers.
In September 2021, MSCI became a founding member of the Net Zero Financial Service
Providers Alliance (NZFSPA), which unites leading index providers, credit rating agencies,
accounting firms, financial exchanges and other suppliers of market infrastructure thathave committed to align their products and services with the goal of global net-zeroemissions by 2050 or sooner.
Our strategy is aligned with — and inspired by — our clients, shareholders, suppliers,
employees and the communities in which we operate. Promoting a sustainable futureis both the right thing to do and good business; we believe that our actions to reduce
MSCI’s carbon footprint help us strengthen relationships with clients and attract andretain top talent.

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TOOLS FOR CLIMATE ACTION
We also offer an evolving array of tools, solutions and research-based insights to help
investors, companies and intermediaries make climate change considerations part offinancial decision-making. These products include: 1— MSCI ESG and Climate Indexes, which integrate environmental, social and governance(ESG) and climate criteria to facilitate sustainable investing strategies. MSCI Climate
Indexes include Climate Change, Low Carbon Target, and Environment Indexes, as wellas our Climate Paris Aligned Equity, Corporate Bond and High Yield Fixed Income Indexes.
— Climate Lab Enterprise, which combines a comprehensive set of climate data andanalytics with powerful forecasting tools to help investors measure, manage andmonitor net-zero commitments and climate exposure and risks across multiple
portfolios and asset classes.
— Total Portfolio Footprinting, which draws on the depth of MSCI’s climate data toprovide a comprehensive view of financed emissions across asset classes.
— Implied Temperature Rise, a forward-looking metric designed to show the temperaturealignment of companies, portfolios and funds with global climate targets.
— Analytical tools, including Climate Value-at-Risk (Climate VaR), which provides
a forward-looking, return-based valuation assessment of how the physical andtransition risks and opportunities related to climate change could affect company
and portfolio valuations.
— Data sets such as Climate Targets and Commitments, and Carbon Footprintingof Private Equity and Debt Funds, which are designed to help investors evaluate
companies’ pledges to reduce carbon emissions, and to measure and monitor
greenhouse gas emissions within private asset portfolios, respectively.

Henry A. Fernandez
Chairman and Chief
Executive Officer— Real Estate Climate Solutions, which help investors build more sustainable portfolios
by integrating climate, performance and risk analytics.
— MSCI’s Net-Zero in Practice, which is a series of workshops offering investors practicalinformation and insights for implementing climate commitments and addressing both
the risks and opportunities that come with the low-carbon transition.

Baer Pettit

President and Chief
Operating Officer

To help educate the marketplace and promote transparency, we make our Implied
Temperature Rise and corporate climate-target scorecards publicly available for more than
2,900 listed companies. We also expanded the public availability of data to include MSCI
indexes and thousands of funds. Each of the models, tools and insights that we provide
aims to bring greater clarity to climate considerations in investing and reflects our broader
mission of helping investors build better portfolios.
Net-zero represents a critical objective for governments, industries and companies, andan existential imperative. MSCI is committed to doing our part.

Diana Tidd

Chief Responsibility Officer

MSCI ESG and climate ratings, research and data are produced by MSCI ESG Research LLC (“MSCI ESG Research”), a subsidiary of MSCI Inc. MSCI ESG Indexes, Analytics and Real Estate offerings areproducts of MSCI Inc. that use information from MSCI ESG Research. MSCI Indexes are administered by MSCI Limited (U.K.).
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Background
The TCFD was created to improve andincrease reporting of climate-related
information to support investors inassessing climate change-related risks.
As of June 2022, the TCFD had 3,400
organizations as supporters.2
The TCFD disclosure recommendations
focus on a framework of four areas thatare core to how companies operate:

06

2021-2022
MSCI HIGHLIGHTS
In January 2021, we submitted aStatement of Support to formallydeclare our support for the TCFD and its
recommendations to drive transparency inthe financial markets. This Report3 uses the
TCFD framework to build on our prior TCFD
Report and reinforce our commitment toprovide clear, comprehensive and highquality information on the impacts ofclimate change.

April 19, 2021

Committed to net-zero emissions
throughout our value chain before
2040
https://www.msci.com/documents/10199/23032795/MSCI-commits+to-netzero-commitment-before-2040-press-release.pdf

July 12, 2021

Introduced the MSCI Net-Zero Tracker,
a quarterly report on the collective
progress of listed companies towardcurbing climate risk
https://www.businesswire.com/news/home/20210712005532/en/ListedCompanies-Have-Less-Than-Six-Years-to-Align-With-1.5%C2%B0C-WarmingTarget-Inaugural-MSCI-Net-Zero-Tracker-Reveals

Sept. 14, 2021

GOVERNANCE

STRATEGY

Introduced new tools to support
investment integration of climate
considerations, including Implied
Temperature Rise, Climate Lab
Enterprise, and Climate Targets andCommitments scorecard and data set(For Implied Temperature Rise)
https://www.msci.com/documents/10199/4252afd2-3ccc-23f3-acd0faede163464e

Sept. 24, 2021
RISK
MANAGEMENT

Became a founding member of
the NZFSPA
https://www.linkedin.com/pulse/msci-joins-net-zero-financial-servicesproviders-henry-fernandez/

Oct. 27, 2021
METRICS ANDTARGETS

Helped educate the marketplace
and promote transparency bymaking Implied Temperature
Rise and corporate climate-target
scorecards publicly available forthousands of companies, funds
and MSCI indexes
https://www.businesswire.com/news/home/20211027005628/en/
MSCI-Makes-Implied-Temperature-Rise-Data-of-Over-2900-CompaniesPublicly-Available

SOURCE: TCFD

GOVERNANCERISK MANAGEMENTThe organization’s governance aroundclimate-related risks and opportunities

The process used by the organization
to identify, assess and manage
climated-related risks

STRATEGYMETRICS AND TARGETS

The actual and potential impacts ofclimate-related risks and opportunities on
the organization’s businesses, strategy
and financial planning.

The metrics and targets used to assess
and manage relevant climate-related risks
and opportunities

April 28, 2022

Filed for Science Based Targets
initiative (SBTi) verification ofenhanced near-term target to
reduce by 2030 our Scope 1 and 2
emissions by 80% and Scope 3 by
50%, aligning with a 1.5°C pathway
https://www.msci.com/who-we-are/corporate-responsibility/
environmental-sustainability

June 13, 2022

Received limited assuranceof 2021 emissions data
MSCI Inc - CY2021 CDP Verification Statement Final - issued 20220613.pdf

See May 2022 “Task Force on Climate-related Financial Disclosures Overview.”
3
The MSCI 2022 TCFD Report incorporates recent company data from 2022, as well as from 2021, to provide readers with the most
updated look at how MSCI integrates climate-related disclosure into its financial decision-making process.
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Governance
BOARD, EXECUTIVE AND
MANAGEMENT OVERSIGHT
We are committed to maintaining
governance structures that underscorethe importance of ESG and climaterelated issues, ensure effective
oversight of those issues and promotetransparency. Our management team has
day-to-day responsibility for identifying,assessing and managing ESG andclimate-related risks and opportunities.
The MSCI Board of Directors (MSCI
Board) oversees management’s executionof these responsibilities.
The MSCI Board allocates responsibilities
across its committees to ensure
appropriate oversight of ESG andclimate-related risks and opportunities.
While the MSCI Board has delegatedprimary oversight of MSCI’s corporate
responsibility policies and initiatives to its
Governance and Corporate Responsibility
Committee, all of its committees receive
regular corporate responsibility updates
as they relate to their respective scopesof responsibility, including those on
climate-related matters. See Figure 1
below and Appendix 1 for additional
information on the MSCI Board’s
four standing committees, including

illustrations of how climate-related risks
and opportunities are allocated.
Several members of our managementlevel Executive Committee, which
includes our most senior executives,
lead, contribute to the developmentof, and oversee our overall strategy
and approach to managing climaterelated risks and opportunities. As the
Chairman of the MSCI Board, our Chief
Executive Officer (CEO) ensures, throughcontinued and frequent communication,that management and the MSCI Board
are aligned on key ESG and climaterelated risks and opportunities. Our Chief
Financial Officer (CFO), working with theEnterprise Risk Oversight Committee(EROC) he chairs and our Enterprise Risk
Management Officer (ERMO), oversees

our enterprise risk management program
to ensure we are identifying, evaluating
and managing risks that may impact
our ability to achieve our operational
objectives, including ongoing assessmentof physical and transition climate-relatedrisks. Additionally, our Chief Responsibility
Officer (CRO), who sets the agenda for our
Corporate Responsibility Policy Committee
and is a member of our Corporate
Responsibility Committee, is responsiblefor developing MSCI’s corporate
responsibility strategy and reporting to
the MSCI Board and stakeholders on
key initiatives across our organization.
See Figure 1 below and Appendix 1 foradditional information on the roles ofour executives and management-levelcommittees in managing climate-relatedrisks and opportunities at MSCI.

The MSCI Board allocates responsibilities
across its committees to ensure appropriate
oversight of ESG and climate-related risks
and opportunities

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FIGURE 1
MSCI’S CLIMATE GOVERNANCE

BOARD, EXECUTIVE AND MANAGEMENT OVERSIGHT
Governance

Roles and Priorities

Board of Directors

Receives ongoing reports on ESG and climate-related risks and opportunities, including
those related to physical and transition risks and MSCI’s products and offerings.
Coordinates across its four standing committees to ensure appropriate committee-level
oversight of ESG and climate.

Governance and Corporate
Responsibility Committee

Maintains primary responsibility for oversight of ESG and climate policies and initiatives,
including environmental stewardship, and periodically reviews with management
shareholder engagement practices and shareholder feedback related to climate practices.

Audit and Risk Committee

Reviews reports on our risk governance framework, risk management practices andemerging key risks, including climate-related risks such as the impact of natural disasterrelated business disruptions.

Compensation, Talent
and Culture Committee

Promotes accountability in its annual assessment of our senior-most executives’performance, including performance against ESG and climate-related goals.
Oversees talent management, including talent acquisition and succession planning relating
to our ESG and climate product line leaders.

Strategy and
Finance Committee

Ensures material climate-related risks and opportunities are integrated into our strategy.

Chief Executive Officer (CEO)MSCI Board Chairman and CEO ensures, through continuous communication, that managementaligns with the MSCI Board on key ESG and climate-related risks and opportunities.

Advises on key partnership and acquisition opportunities that promote sustainable
operations, enhance our climate-related products and services, or support otherstrategic initiatives.

Leads MSCI’s pursuit of climate goals, such as our commitment to achieve net-zero carbon
emissions throughout our value chain by 2040 and our becoming an NZFSPA founding
member in 2021.

President and Chief
Operating Officer (President)

Oversees, among others, our Chief Responsibility Officer, Chief Technology Officer and Chief
Product Officer, who have varying responsibilities in assessing and managing ESG andclimate-related risks and opportunities.
The President also manages investments in key strategic growth and operational areas,
including investments in ESG and climate-related opportunities and strategies.

Chief Human
Resources Officer (CHRO)

Oversees our Head of Corporate Services, who manages climate-related matters that
impact our supply chain, physical locations and environmental sustainability.

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2022 TCFD REPORTFIGURE 1
MSCI’S CLIMATE GOVERNANCE

Governance

Roles and Priorities

Chief Financial Officer (CFO)

Chairs EROC and works with our ERMO to oversee our enterprise risk management
program to ensure we are identifying, evaluating and managing risks that may impact
our ability to reach operational and strategic goals.
Oversees the Strategy and Corporate Development functions, including assessmentof acquisition and partnership opportunities that enhance our ESG and climate
product capabilities.

General Counsel

Enhances MSCI’s corporate governance and corporate responsibility practices and profile.
Delivers periodic reports to the Governance and Corporate Responsibility Committee on
evolving corporate governance practices and trends, as well as shareholder requests
and expectations.

Chief Responsibility
Officer (CRO)

Reports directly to President.
Creates the annual Corporate Responsibility Operating Plan, engages key decision makers,
internal experts and other stakeholders on corporate responsibility-related actions such as
our net-zero and carbon-reduction targets.
Updates Governance and Corporate Responsibility Committee quarterly; reports are madeavailable to full MSCI Board.

Chief Technology Officer andHead of Engineering (CTO)

Oversees our Business Resiliency Team, which, for example, assesses the severity,
probability and scale of potential extreme climate events in geographies where we operate.
This team develops, implements and tests technology systems to support MSCI’s business
continuity plans. Oversees MSCI’s CISO.

Corporate Responsibility
Policy Committee (CRPC)

Cross-functional group of Executive Committee members who meet at least quarterly
to discuss strategically significant proposals on corporate responsibility policies,
commitments, actions and disclosures.

Corporate Responsibility
Committee (CRC)

Cross-functional group that meets monthly to review corporate responsibility trends, share
updates on implementation of our Corporate Responsibility Operating Plan, and review ourcorporate responsibility reports.

Enterprise Risk
Oversight Committee (EROC)

MSCI’s assessment and management of climate-related risks and opportunities, includingtransition and physical risks, is integrated into our firmwide risk management framework
and reporting.
The EROC receives reports at least semi-annually from the CRO on MSCI’s progress on
managing climate-related risks, including key efforts to meet carbon reduction targets.
The ERMO provides quarterly updates to the Audit and Risk Committee, which periodically
include assessment of climate-related risks.

Climate Action Networks

Local, employee-led groups at 24 MSCI offices as of June 2022, that aim to increaseawareness, engagement and management of local and global environmental issues.

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2022 TCFD REPORT10FIGURE 2
MSCI CLIMATE VaR

Impact Modeling
Aims to measure impact of policy
risks across the value chain,cleantech opportunites andphysical climate risks, acrossdifferent scenarios.

Strategy1) MSCI’S CLIMATE-RELATED RISKSAND OPPORTUNITIESWe define our climate strategy in connection
with our annual firmwide medium- andlong-term strategy setting process. Throughthis process, as well as our short-term
annual operating plan that formalizes ourplans for the coming year, and our ongoingrisk management processes, we identify
climate-related risks and opportunities
concerning our operations, products
and services. Our operations include
our products and business operations,
our supply chain and our investment inresearch and development. Our products
and services include the climate-related
products and services we offer and develop
for the investment industry.
CLIMATE RISKS
Since 2020, we have used the Climate VaRmodel from MSCI ESG Research to conduct
a detailed climate-related scenario analysis
that allows us to quantitatively analyze
climate-related risks—both transition andphysical—we may face in the coming years.
The Climate VaR model is designed toprovide a forward-looking and return-based
assessment to measure climate-relatedrisks and opportunities in an investment
portfolio. For example, extreme weather
could damage assets at a company facility
while new climate change regulation
could require technological change. Bothscenarios could impact a company’s

Cost / Green Profit Calculation
operations and financial results. By
calculating the financial risks from climatechange per security and per scenario, ourClimate VaR model provides a frameworkthat helps investors identify these risks
and proactively optimize their portfolio
performance, risk management andregulatory reporting.
The approach follows TCFD
recommendations by assessing bothtransition and physical risks andopportunities. The Climate VaR metricprovides insight into the climate-stressedvaluation of assets based on specificscenarios such as those established by
the Paris Agreement, which aims to limit
the rise in average temperatures to well
below 2°C, preferably to no more than
1.5°C, above preindustrial levels.
We have used the TCFD framework to
categorize our climate-related risks andopportunities. We use both quantitative andqualitative measures to assess the potential
for substantive strategic or financial
impacts from climate change, consistent
with how we evaluate the impact of othernon-climate change risks to our firm. We
also consider climate-related risks andopportunities in terms of the time horizonof such an impact—specifically, across theshort- (less than one year), medium- (one tothree years) and long-term (more than three
years). These time horizons align with ourbusiness, strategy and financial planning.

Calculate scenario-specifictime series of costs / profits
associated with:— Reaching emissions-reduction
targets (policy risk)— Benefits from developing
low-carbon technologies(technology opportunity)— Financial consequences ofchanges in acute and chronic
physical events (physical risks /opportunities)

Impact on Security Valuation
Translate climate-related costs
into valuation impacts to provide
a stressed market valuation of asecurity in relation to aggregatedtransition and physical cost andprofit projections until the end of
the century.

Portfolio Level
Aggregation at portfolio levelavailable across different scenarios.

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FIGURE 3
CLIMATE TRANSITION RISKSPOLICY & LEGAL
Examples of Risks
Enhanced emissionsreporting obligations

Low

Potential Impact

MediumHigh

Realization Strategy
We believe our policy and legal risk relating to emissions reporting is
low overall as a company that provides data, tools and analysis to theinvestment community.
Our Legal and Finance teams monitor existing and emerging
emissions-reporting regulations, ensuring we have appropriate
controls in place to meet emissions-reporting obligations.
As part of our commitment to transparency, we provide details on
climate-related risks and opportunities to shareholders using standards
such as TCFD as well as responding annually to the CDP questionnaire.
MSCI’s Corporate Services team is responsible for ensuring
compliance with environmental regulations. The team manages
landlord relationships and contracts for our office leases to identify
and manage local environmental regulations.

Mandates on and regulation ofexisting products and services

The Government and Regulatory Affairs team monitors regulatory
developments that may affect our products and services, alertinginternal groups to relevant changes.
We regularly submit public comments to regulators on proposed
regulation and track regulatory developments, equipping us withinsights we use to improve our products and meet clients’evolving needs.

Exposure to litigation

Due to the nature of our business, and the products and services
we offer, we do not consider climate transition-related litigation risk
to be material. We structure our client contracts to limit our exposure
to liability and adopt robust business continuity processes.

Increased pricing ofgreenhouse gas emissions

To mitigate risks regarding greenhouse gas emissions pricing,
we have committed to reach net-zero emissions before 2040, set
near-term carbon reduction targets and are taking steps to reduce
our carbon footprint and increase our use of renewables.

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2022 TCFD REPORT12FIGURE 3
CLIMATE TRANSITION RISKSTECHNOLOGY
Examples of Risks

Low

Potential Impact

MediumHigh

Realization Strategy

Unsuccessful investment in
new technologies

We believe our technology-related risk relating to climate transition is low.

Costs to transition tolower-emissions technology

We purchase energy-efficient products for our offices and rely heavily
on sustainable products, including recycled and low-environmentalimpact materials. We believe switching to more sustainable equipment
will boost efficiency, resulting in lower costs over time. This practicehas already contributed to reduced emissions, and we believe thecontinued use of lower-impact equipment and materials will further
reduce our emissions and associated risks.

Our IT team is responsible for monitoring the adoption of newtechnologies. All of MSCI’s data centers are powered by renewables
and employ leading energy consumption and heat management
techniques. Since July 2020, MSCI has used Microsoft Azure as its
strategic cloud services provider. Microsoft has publicly disclosed acommitment to being carbon-negative by 2030.

MARKET
Examples of Risks

Potential Impact

Realization Strategy

Changing customer behavior

We proactively educate investors on climate risks and opportunities,
providing them with a full suite of tools and research to help better
manage climate issues in their investments.

Uncertainty in market signals

MSCI consults with the global investment community and regularly
engages with clients through meetings and events such as clientadvisory panels and surveys to enhance and keep current our
climate risk-related and other products.

Increased cost of raw materials

We believe climate-transition risks related to increased costs of raw
materials are low for MSCI. We regularly look for ways to reduce
the potential impact of supply-chain disruptions, identifying multiple
sources of critical services wherever possible.

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FIGURE 3
CLIMATE TRANSITION RISKS

Low

MediumHigh

REPUTATION
Examples of Risks

Potential Impact

Realization Strategy

Shifts in consumer preferences

MSCI proactively engages with the investment community throughconsultations, surveys and events to ensure we are well-positioned
to meet client demands and minimize our market risk.

Increased stakeholder concern
or negative feedback

MSCI could face reputational risk in the event of a perceived
misalignment between our operations and our solutions. This
could negatively impact our capital costs, long-term value creationand client satisfaction as well as our ability to attract and retain
talent. We have set aggressive targets, expanded our initiatives
and published new reports to serve as an industry leader anddemonstrate leading corporate responsibility practices. We regularly
monitor for potential gaps between our actions and our solutions
and regularly engage with the MSCI ESG Research team to identify
additional steps we can take.
Failure to fulfill our commitments and reach our targets could result
in reputational harm, such as a loss of credibility.

Stigmatization of sector

We are collaborating with our peers to reduce potential
stigmatization of our sector. In 2021, we became a founding memberof the NZFSPA, which includes major financial services providers
committed to aligning all relevant products and services
to achieve net-zero by 2050.

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FIGURE 4
CLIMATE PHYSICAL RISKS

Low

MediumHigh

Risk Type

Risk Example

Acute - Coastal
Flooding Tropical
Cyclones

Increased severity of
extreme weather events
such as tropical cyclones

Chronic - Extreme
heat and others

Changes in precipitation
patterns and extreme
variability in weather
patterns
Rising mean temperatures
Rising sea levels

Potential
ImpactRealization Strategy
We use our proprietary Climate VaR model to assess physical risks.
In 2022, our scenario analysis revealed moderate exposure to tropical
cyclones, extreme heat and coastal flooding in certain MSCI locations.
Other physical risks were deemed low. (e.g., fluvial flooding, wildfire,
extreme cold, etc.) See Strategy section 3 for more details on ourphysical risk exposure. We also use our Climate VaR model and otherinformation to inform our office-location strategy to mitigate thedisruption to our business as a result of longer-term global climatechanges. When selecting new office space, we account for a property’s
vulnerability to extreme weather events and natural disasters.
We maintain a dedicated Business Continuity Planning group as wellas business continuity planning software to manage plans, testing
and communication. MSCI’s Business Resilience Strategy considers
the extent to which the physical risks of climate change may impact
MSCI’s operations or financial results. That includes whether extreme
weather events or natural disasters could potentially impact thecapacity of our Information Technology (IT) and physical infrastructure
or our ability to provide clients with products and services. We use
business resilience as a framework for developing plans for business
continuity and IT disaster recovery, as well as plans for minimizing
business disruption and maintaining operations should a climaterelated business or technology disruption occur.
MSCI’s Crisis Management and Technology Service Operations
Service Management Teams are responsible for our company’s
disaster response and recovery efforts. Among the goals of disasterrecovery planning and testing are safeguarding the welfare andsafety of MSCI’s employees, together with protecting and recovering
our data centers, networks, business applications, communications
systems and technology in the event of an extreme weather incident
or natural disaster. The teams would escalate to the EROC climaterelated physical risks that might have a significant impact on ouroperations or financial results.
We regularly evaluate the potential for supply-chain disruption, which
includes climate-related impacts over both short- and long-termhorizons. Wherever possible, we identify multiple sources of criticalservices to reduce the potential impact of supply-chain disruptions. We
also seek opportunities to reduce our reliance on supply chains, with theadditional impact of potentially lowering operating costs.
We regularly evaluate the adequacy of our insurance to mitigate longerterm/chronic climate-related risks.

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We believe that the nature of MSCI’s
business as a provider of tools andsolutions to the investment industry
helps limit many common physical risksof climate change.

The coronavirus pandemic highlighted
MSCI’s ability to rapidly transition toremote work, while maintaining thehighest level of performance amid
disruptions to the global economy.
We believe this type of flexibility
demonstrates an ability to continue
to perform in other situations,
including those resulting from climaterelated impacts. Most of our officespaces are leased, which also allows
flexibility and helps lower exposure
to physical risks. As our response to
the pandemic showed, MSCI has theflexibility to reduce reliance on any oneof our office locations if necessary.
We also have availed ourselves of
the geographically diverse locationsof data centers offered by our cloudcomputing partner Microsoft Azure.
See Appendix 2 for a list of our data
center locations.

CLIMATE OPPORTUNITIESThe global adoption of climate-focusedinvestment considerations is rapidly
accelerating. We provide critical tools
and solutions that enable investors tounderstand how climate change could
affect their portfolios, identify low-carbon
investment opportunities and set netzero targets. (See opening letter, “MSCI:
Committed to Climate Action.”) Becauseof the nature of our business as a provider
of tools and solutions to the investment
industry, we believe that we are able toadapt to changing client needs and launch
products quickly, unlike companies withlonger and more involved manufacturing
and distribution processes.

As a founding member of the NZFSPA,
we are committed to providing products
and services that help clients align theirportfolios with net-zero goals.
As demand from our clients for ESG
and climate solutions increases, ourresearch, tools and solutions will aim
to provide the transparency our clientsneed to better integrate climate risks
and opportunities into their investment
processes. We are focused on being an
influential thought leader on climaterelated considerations for the investment
industry. Recent examples of ourpublished research include:— The MSCI Net-Zero Tracker, a quarterly
report on progress by the world’s listedcompanies on curbing climate risk

We provide critical tools and solutions that enable
investors to understand how climate change
could affect their portfolios, identify low-carbon
investment opportunities and set net-zero targets— “Foundations of Climate Investing:
How Equity Markets Price Climate
Transition Risks,” examining thefinancial impact of climate transition
risk on global equity markets— “Net-Zero Alignment: Objectives andStrategic Approaches for Investors,”
examining how three common
approaches to net-zero investing
may help investors reduce carbon
emissions in their portfolios andthe economy— “Stress Testing Portfolios for ClimateChange Risk,” examining how scenario
analysis can be a powerful tool to help
investors understand the implicationsof climate change for their portfolios— “Net-Zero Now,” a documentary thatpremiered in September 2021, showing
how investors will play a critical role inlowering carbon emissions throughout
the global economy and reviewing key
metrics and portfolio-alignment tools
These and other MSCI insights areavailable at https://www.msci.com/
research-and-insights?topic=esg.

MSCI: COMMITTED
TO CLIMATE ACTION

2022 TCFD REPORT16

FIGURE 5
CLIMATE OPPORTUNITIESRESOURCE EFFICIENCYExamples of Opportunities

Low

Potential Impact

MediumHigh

Realization Strategy

Use of more efficientbuildings and systems

We have explored many opportunities related to resource efficiency,
and we continually seek to do more, including by selecting officespace in Leadership in Energy and Environmental Design (LEED),
Building Research Establishment Environmental Assessment
Methodology (BREEAM) or other highly efficient, green-certified
buildings, implementing energy-efficient systems and equipment
and utilizing automated lighting and air controls across our offices.

Use of recycling

MSCI maximizes recycling, including e-waste. During our officeselection process, we consider whether potential offices havelandlord-driven or local recycling initiatives.

Use of more efficientmodes of transport

Our business travel policies request employees to prioritize lowcarbon travel options by selecting, for example, rail travel in lieu of
air or economy class instead of business class. We aim to reduce
our employees’ commuting emissions by promoting teleworking
and supporting climate-friendly commuting practices.

ENERGY SOURCE
Examples of Opportunities

Potential Impact

Realization Strategy

Use of lower-emission
sources of energy

While MSCI has implemented a significant number of energy
efficiency projects, we continue to adopt efficiency measures,and we are increasing our use of renewables as part of our carbonreduction strategy. We consider the availability of renewable energy
when selecting new office locations.

Use of new technologiesparticipation in carbon market

In 2021, we purchased Energy Attribute Certificates (EACs) toaccess renewable electricity across most of our offices. We plan toreview our potential use of EACs each year as a means to green theelectricity we use and to support the greening of local electricity grids.

Use of supportive
policy incentives

We proactively support the implementation of local andgovernmental measures to increase renewable energy use
where applicable.

MSCI: COMMITTED
TO CLIMATE ACTION

2022 TCFD REPORT

17

FIGURE 5
CLIMATE OPPORTUNITIESPRODUCTS & SERVICES
Examples of Opportunities
Development of new
products or services throughresearch and development
and innovation

Low

Potential Impact

MediumHigh

Realization Strategy
We believe MSCI ESG and Climate solutions, a key component of
our strategy, have great potential to generate business opportunities.
MSCI provides a full suite of ESG and Climate solutions acrossasset classes to institutional investors globally. With our acquisitionof Carbon Delta, we enhanced our climate expertise and expanded
our range of solutions to include scenario analysis such as MSCI
Climate VaR.
We continue to invest in research and organic product development
and expand our use of natural language processing and otherartificial intelligence technologies to solve an increasingly complex
set of problems for our clients.

Shift in consumer preferences

We annually review our forward-looking strategy with the MSCI
Board and, through our operating plan process, review, rank
and prioritize investments based on client demand and growth
opportunity. We study the markets, compile extensive stakeholder
input to stay abreast of market changes, and seek to ensure weare at the forefront of ESG and Climate solutions development.

Reputational benefits resulting inincreased demand for products
and services

As a provider of climate-related products, MSCI is part of ourclients’ supply chain. Combining robust climate targets with clear
steps to reduce emissions to net-zero before 2040 illustrates that
we also demonstrate the same leading practices as many of thecompanies we analyze and that we are a strong match for clients,
including from a carbon perspective.

MSCI: COMMITTED
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2022 TCFD REPORT18

FIGURE 5
CLIMATE OPPORTUNITIESMARKET
Examples of Opportunities

Low

Potential Impact

Access to new markets

MediumHigh

Realization Strategy
In addition to developing new solutions based on our clients’ needs,
we identify new markets or areas of opportunity. This could include
expanding to new client segments, countries or asset classes. As
ESG and Climate-focused strategies are more widely adopted, we
can leverage our extensive expertise to build solutions for new
segments such as corporates, bank advisory businesses, insurance
providers and others. We also launch products in asset classes
such as fixed income climate indexes and private asset class data
to expand our presence. As new countries seek to address climatechange, we can reach clients in those markets with our ESG andClimate solutions.

RESILIENCE
Examples of Opportunities

Potential Impact

Realization Strategy

Participation in renewable energy
programs and adoption of energy
efficiency measures

We are taking steps to reduce our energy use, such as byimplementing hybrid work policies to enable us to shrink our office
footprint. We accessed renewable electricity through market-based
measures via the purchase of EACs in 2021.

Resource substitutes/diversification

MSCI has established a Sustainable Supplier Management team to
fully integrate climate considerations into our supplier selection andprioritize our spend with highly resilient and sustainable suppliers.

MSCI: COMMITTED
TO CLIMATE ACTION

2) THE IMPACT OF CLIMATE-RELATEDRISKS AND OPPORTUNITIESCLIMATE TRANSITION RISKS
We face climate transition risks related toour own management of climate change
into our operations and while working toensure our products continue to meet clientdemands as they relate to climate change.
Risks related to our operations:
To reduce climate transition risk related
to our own operations, MSCI is aiming
to align our strategic and operational
decision-making with the long-term goalof achieving net-zero emissions andlimiting average temperature rise to 1.5°C
above preindustrial levels, and we areencouraging our suppliers to do the same.
Our efforts to lower our carbon emissions
are guided by our near- and long-termscience-based carbon-reduction targets.
In April 2021, MSCI committed to reachnet-zero emissions throughout ourvalue chain before 2040. In April 2022,
we submitted for verification by SBTi anear-term target to reduce Scope 1 and 2
emissions by 80% and Scope 3 emissions
by 50%, each by 2030 from a 2019baseline. Our Scope 3 emissions target

2022 TCFD REPORT

19

includes all relevant Scope 3 emissions,
i.e., purchased goods and services, fueland energy-related, waste, business travel,
employee commuting and downstream
leased assets.
We plan to authentically seek to reduce ourgreenhouse gas emissions to achieve ourcarbon emissions reduction targets andmitigate climate transition risk while beingtransparent about our plans and actions.

REDUCING SCOPE 1 AND 2 EMISSIONS
The main levers we aim to use to reduce
our consumption of electricity, themain source of MSCI’s Scope 1 and 2
emissions, are the following:— Reducing the footprint of our existing
offices wherever possible. The
coronavirus pandemic has allowed
us to reimagine the functions of ourphysical offices by fully supporting a
hybrid work environment that fosters
flexibility and innovation. This flexible
approach allows us to adjust the sizeof existing offices.
— Improving energy efficiency. We willcontinue to identify new ways touse energy more efficiently such as2030 GOALS

80%

Reduction in Scope 1 and 2 emissions
from our 2019 baseline

50%
Reduction in Scope 3 emissions fromour 2019 baseline

MSCI: COMMITTED
TO CLIMATE ACTION

through climate control setbacks,energy-efficient lighting, motion sensors
and other technologies designed toconserve energy. We prioritize selecting
buildings with green certificationsuch as Leadership in Energy andEnvironmental Design (LEED) or Building
Research Establishment Environmental
Assessment Methodology (BREEAM),
granted to buildings that have been
designed, built and maintained using
green building and energy efficiency
best practices. At MSCI, 88% of ouremployees are based in office buildingsthat meet LEED or BREEAM certified
energy efficiency standards. We alsoprioritize locations that use renewableelectricity when we do seek to expand
our office locations.
We intend to review annually thepotential purchase of EACs to lower ourunavoidable Scope 2 emissions. An EAC
is the official documentation to prove
renewable energy consumption. Each EAC
represents proof that 1 MWh of renewableenergy has been produced and added
to the grid. We will consider purchasing
EACs for the specific locations where
we are using the electricity. In 2021, wepurchased EACs for our major locations—India, United States, Europe, the United
Kingdom, China, Singapore and thePhilippines—at an average price of USD
6.40 per MWh. We used Green-e® Energy
Certified EACs, of which we confirmed theretirement for 2021, to ensure high-quality
certificates. This purchase allowed us toreach 94% renewable electricity.4

REDUCING SCOPE 3 EMISSIONS
We are taking steps in three areas that will
be key to reducing our Scope 3 emissions
in line with the targets we have established.
— Supply-chain emissions. Emissions
across our supply chain accounted
for 78% of our total carbon footprintin 2021. Our efforts to significantly
reduce our supply-chain emissions
represent a major commitment for
MSCI. We are developing a program

4.

2022 TCFD REPORT20In April 2021, MSCI committed toreach net-zero emissions throughout
our value chain before 2040
to engage with and influence our
suppliers to reduce their emissions.
We have created a dedicatedSustainable Supplier Management(SSM) team to spearhead thiseffort by helping to improve ourunderstanding of our suppliers’ carbon
emissions reduction commitments
and environmental practices. The
SSM team collects information
through online research and supplierself-reporting about suppliers’ climate
commitments to help us identify
and engage with suppliers basedon the strength of their climate
commitments. Our engagement
focuses on both the importance ofsetting carbon emissions reduction
targets and our expectation that
suppliers share our commitments(backed by clear actions) to support
our efforts to reach our net-zero goal.
We monitor metrics regarding the
portion of our suppliers who havecarbon commitments.
— Business travel. We continue tomanage business travel emissions by
maintaining policies that encourage
employees to replace travel with virtual
meetings where appropriate. When
travel is necessary, we encourage
the use of low-carbon alternatives,

Green-e is a highly reputable green certification scheme for energy attribute certificates: Green-e | Powering a renewable future

including rail instead of air, economy
flights instead of business, andrental of electric or hybrid vehicles. In
addition, we implemented a carbonaware event strategy.
— Employee commute and impact. We
are reducing the need for employees
to commute by requiring less in-officework. We support flexible working,which encourages virtual meetings
and work from home. When weevaluate potential new locations theavailability of convenient, high- quality
public transportation is part of our site
selection criteria. As of June 2022,
we had 24 Climate Action Network
employee resources groups that lead
discussions on local and at-homeclimate aware practices such asenergy efficiency practices, renewableenergy options and water conservation.
We anticipate that MSCI’s trajectoryof carbon reductions will not be fully
linear, and our plan will evolve overtime to align with the latest science,the emergence of new and greener
technologies, and as new data becomes
available. As we revise our plans, we arecommitted to making our approach clear
and transparent by regularly reporting
our progress.

MSCI: COMMITTED
TO CLIMATE ACTION

Risks related to our solutions:
Any reputational harm or loss of credibility
sustained by our operating segments,
product lines or company as a whole
could impact our business. That scenario
could materialize if there is a perception
our operations or the solutions we offer
are misaligned with our sustainability
and corporate responsibility policies
or practices. Failure to meet publicly
disclosed ESG and climate-related goals
or to keep pace with evolving market
standards or the methodologies andstandards used in our products and ESG
ratings could negatively impact our brandand hamper our ability to grow our ESG
and Climate product lines. In some cases,
our ESG and Climate offerings, such as
our company ESG ratings and our NetZero Tracker, may thrust MSCI into apublic spotlight regarding environmental,social or corporate responsibility issues.
In addition, our position as a leading
source of ESG research, ratings, data andassessments could result in disputes
with stakeholders and generate negative
media or regulatory attention. Our
reputation could further be harmed as aresult of competitors’ errors or missteps
that have ripple effects on our industry.
We work to demonstrate leading
corporate responsibility practices,and regularly engage with our MSCIESG Research Team to learn, identify
and plan new initiatives. Both our
Corporate Responsibility and Corporate
Responsibility Policy Committees include
representatives from MSCI ESG Research.
Additionally, MSCI regularly engages withclients to track their needs and minimize
our market risk. We aim to identify shifts
in client interest through global client
consultations, annual client surveys,
advisory panels, roundtables and otherevents. We also review questions included
in clients’ requests for proposal andstudy market trends to address the fastchanging needs of investors.

FINANCIAL PLANNING:
As part of MSCI’s short-, medium- andlong-term financial process and quarterly
business reviews, senior management,
including the Executive Committee,
reviews business results and trends,
including incurred and projected costs

2022 TCFD REPORT

21

associated with providing climate-related
products, as well as creating moresustainable operations. As part of thisfinancial planning, MSCI evaluates theimpact of climate change on MSCI’s direct
costs. Climate-related costs that have
impacted financial planning costs include:— Direct costs of investing in technology
to reduce MSCI’s Scope 3 greenhousegas emissions by:A) automating labor-intensive processesB) strengthening the firm’s virtual 		meeting tools to minimize travel
while maintaining high levels of 		client engagement— Direct costs of developing policies andpractices to promote environmental
sustainability and efficiencies, including
prioritizing LEED- and BREEAM-certified
office space when entering into leases
We also regularly review opportunities
for acquisitions and partnerships. In
2019, MSCI acquired Zurich-based
environmental fintech and data analytics
firm Carbon Delta to create an extensive
climate risk assessment and reporting
offering for the institutional investment
market. We also consider any climaterelated impacts through our businessresilience process and insurance
coverage, including the cost of premiums.
MSCI is currently not using an internalcarbon price but anticipates doing so in
the next two years.
In addition to climate-related costs, MSCI
plans and investigates climate-related
revenue opportunities as outlined within
this section below and in Metrics andTargets section 1.

CLIMATE PHYSICAL RISKS
Though the physical risks of a warming
climate affect all facilities to varying
degrees, a scenario analysis using our
Climate VaR model indicates MSCI faces
risk of extreme heat, coastal flooding andtropical cyclones in certain locations.
Refer to Appendix 3 for a description of
the Climate VaR methodology and thenext section for more detail about our
exposure to extreme weather events.

To enhance organizational resilience,
we maintain a team of employees fromdiverse functions to lead and manage
business continuity planning (BCP).
The BCP team assesses the severity,
probability and scale of extreme weather
events in locations where we operate.
It then develops, implements and tests
systems to support business continuity.
To facilitate management of potential risks,
we monitor threats of extreme weather
using both our Climate VaR analysis andClimate Risk Trend Report, which identifies
natural disasters and other potential
threats that may impact our offices.
We perform frequent BCP and tabletop
scenario planning exercises to rehearse andcontinually enhance the protocols of ourbusiness resilience strategy. We test ourbusiness continuity and IT disaster recovery
plans periodically, and report results to
MSCI’s IT Risk Oversight Committee.

MSCI: COMMITTED
TO CLIMATE ACTION

In addition, we regularly evaluate thepotential for disruptions to our supply
chain. New business-critical suppliers areevaluated by MSCI’s Information Security,
BCP and Sustainable Supplier Management
teams and must pass rigorous onboarding
requirements. Our objective is tounderstand the potential for disruption
over the short, medium and long term
due to various factors, including climate,weather and other physical impacts.
We analyze our suppliers’ resiliency andbusiness continuity plans to determine
their capacity to handle temperature
extremes, storm damage, coastal flooding
and other physical climate conditions thatmay disrupt their operations and, in turn,
directly or indirectly impede our operations
or ability to deliver products and services.
We identify multiple sources of criticalservices to reduce the potential impact
of supply-chain disruptions wherever
possible. For example, MSCI maintains
data centers in both Europe and the U.S. toenhance our ability to maintain continuity
in the event either location was impacted
by extreme weather or other climaterelated events. Notably, MSCI partners
with Microsoft Azure as a strategic
cloud services provider. Azure provides
MSCI geographically diverse data center

2022 TCFD REPORT

22

We perform frequent Business Continuity
Planning and tabletop scenario planning
exercises to rehearse and continuallyenhance the protocols of our businessresilience strategy

locations, which allow us to minimize
disruption at specific sites. Microsoft iscommitted to being carbon-negative by2030. We work to reduce our reliance on
extended supply chains with the goal of
improving resilience and lowering costs.
For example, we use regional and local
re-distributers for technology hardware
and software. We also consider thelocations of prospective consultants
and contingent workers before engaging
them for business-critical operations, andemphasize local and regional sourcing for
furniture, fixtures and office supplies for ouroffices around the world.

When selecting new office space, we
follow a comprehensive checklist to
determine a building’s vulnerability to
extreme weather events and natural
disasters. We also consider otherfeatures such as its proximity to public
transportation and energy efficiency of
its core building systems and controls
to reduce electricity consumption. We
purchase energy-efficient and sustainableproducts for our offices, including
supplies made from recycled and lowenvironmental-impact materials. These
practices have contributed to reducing
emissions company-wide.

MSCI: COMMITTED
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2022 TCFD REPORT23

The growing interest in climate change by investors
has led to a strategic focus on climate in our productdevelopment. We offer climate solutions acrossproduct lines and asset classes, and to support a
growing number of client types and use cases
CLIMATE OPPORTUNITIESMSCI is a founding member of
the NZFSPA, which unites leading
index providers, credit rating
agencies, accounting firms,
financial exchanges and othersuppliers of market infrastructurecommitted to providing products
and services to support achieving
global net-zero emissions by
2050, integrating into their corebusiness the goal of limiting global
temperature rise to 1.5°C.5
Members commit to setting aninterim target to have offerings
for relevant products and services
that align with a 50% global
reduction in carbon emissions by
2030 and updating such targets
every five years, among other key
actions. The NZFSPA is part of the
Glasgow Financial Alliance for Net
Zero (GFANZ), a global coalitionof leading financial institutions in
the U.N.’s Race to Zero campaign
committed to accelerating thepace of reducing carbon emissions
in the economy.
The growing interest in climate change byinvestors has led to a strategic focus on
climate in our product development. We
offer climate solutions across productlines and asset classes, and support a
growing number of client types and use

cases. Since launching an important
climate product, the MSCI Low Carbon
indexes, in 2014, we observed growing
investor interest in climate-related issues.
This demand, which influences MSCI’s
short- and long-term business strategy,
resulted in the diversification andexpansion of our offerings.

growth offerings in recent years. They
address growing interest from investors,
companies and financial intermediaries
in integrating climate change into theirinvestment decisions. We are focusedon being an influential thought leader on
climate-related considerations for theinvestment industry.

The emergence of climate-disclosure
frameworks and climate-related financial
and transparency regulation has also
increased demand for climate-related
stress testing and scenario analysis.
Our Climate Risk Center, which weestablished following our acquisition of
Carbon Delta in 2019, features specialists
dedicated to developing intuitive,
forward-looking tools to help investors
measure and manage risks associatedwith climate change, identify climaterelated opportunities for innovation andpositive impact, and make environmental
sustainability part of their long-term
investment strategy. This team has
doubled in the last two years.

As an example, in 2021, we launched
Climate Lab, a first-in-kind visualization
dashboard that combines our climate
data with our analytical risk and portfoliomanagement capabilities. Climate
Lab combines comprehensive climate
data, analytics and scenario analysis
with powerful forecasting tools to help
investors measure, monitor and manage
climate risk and the shift to sustainablegrowth consistently across companies,
portfolios and enterprises.

We anticipate continuing to invest in
expanding and enhancing our climate
and ESG-related products and services.
MSCI’s climate indexes, metrics, data
and analytical tools, together with our
ESG research and ratings provided by
MSCI ESG Research, are some of ourmost strategically important and highest-3) RESILIENCE OF MSCI’SSTRATEGY UNDER DIFFERENT
CLIMATE SCENARIOSIn 2022, we conducted a detailed climaterelated scenario analysis using MSCIESG Research’s Climate VaR Model andinformation with respect to the year
ended Dec. 31, 2021 to quantitatively
analyze the climate-related risks andopportunities we face.6 The model
assesses potential future climate changerisks and opportunities, which include
transition risks and opportunities that may

See “Committed to Net Zero,” Net Zero Financial Service Providers Alliance, https://www.netzeroserviceproviders.com/
IMPORTANT NOTICE: MSCI ESG Research has developed a fully automated and forward-looking financial climate risk model, Climate VaR, that was used to quantitatively analyze certain climate-related risks
and opportunities included in this report for MSCI Inc. In addition, MSCI ESG Research has developed Implied Temperature Rise, a metric designed to show the temperature alignment of companies, portfolios
and funds with global climate targets. MSCI Inc. is the ultimate parent company of MSCI ESG Research. The disclosure of the Climate VaR model and Implied Temperature Rise score included herein for MSCI
Inc. was conducted in the same manner and based on the same information available for other companies not affiliated with MSCI Inc., but have not been independently reviewed or audited. Due to the affiliate
relationship and the potential for a conflict of interest, this report should not be relied upon as an independent analysis of MSCI Inc. with respect to the use of the Climate VaR or Implied Temperature Rise.
5
6

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Within the Policy Climate VaR analysis,
the Direct Emissions Climate VaR
captures future costs related to reducing
direct (Scope 1) emissions and MSCI’s
direct (Scope 1) emissions are very low,
the risk associated with these emissions
are low. Therefore, MSCI’s Direct Emission
Climate VaR is zero.
In addition, MSCI does not have direct
exposure to clean technologies anddoes not hold any low-carbon patents,
so therefore the Technology Opportunity
Climate VaR is zero for MSCI.

arise from limitations on greenhouse gas
emissions, as well as risks resulting fromthe physical effects of climate change.7
More specifically, MSCI ESG Researchcalculates an aggregate Climate VaR
that consists of the Transition Climate
VaR and the Physical Climate VaR.
The Transition Climate VaR captures
both risks and opportunities using thedownside Policy Climate VaR and theupside Technology Opportunities Climate
VaR. See Appendix 3 for definitions andmore details on our methodology.
This scenario analysis reported that
MSCI’s aggregate Climate VaR is -1.32%,
which means the company’s valuation
can be reduced by -1.32% in a 2°C midrange and aggressive physical risks
scenario. Looking more closely at the
Climate VaR result, we identified thatthe main contributor is Physical Climate
VaR, as -0.05% of the Climate VaR,
comes from Policy Climate VaR, while-1.27% comes from Physical Climate
VaR. The analysis examines policy risks
and technology opportunities under fivedifferent scenarios:
1. Integrated Model to Assess the
Global Environment 2°C, Shared
Socioeconomic Pathways 1 (IMAGE
2°C SSP1): Gradual action scenario
relying on renewable power generationand the electrification of the transport
sector with net-zero emissions
achieved in 2090.
2. Asia-Pacific Integrated Assessment
Model/Computable General
Equilibrium 1.5° (AIM/CGE 1.5°C):
Early ambitious action with emissions
peaking in 2020 and net-zero achievedin 2055 limiting global warming to
1.3°C by the end of the century. Major
emphasis on renewable energy with
85% of electricity generation comingfrom renewable sources in 2050.
3. AIM/CGE 2°C: Early action 2°C
scenario with emissions peaking in2020 and 90% reduction by 2090, butemission levels never reach net-zero.
This results in a warming of 1.62°C
in 2100.
4. AIM/CGE 2°C Late: Late action 2°C
scenario with emissions peaking in2020 but reductions not starting until
2030 and net-zero reached in 2060,
resulting in warming of 1.8°C at theend of the century.
5. AIM/CGE 3°C: Limited policy action
with emissions slowly decreasingover time but never reaching net-zero,
limiting warming at the end of the
century to 2.8°C.

The analysis also considers two scenarios
to assess the physical risk exposure of
MSCI to determine an aggregated Physical
Climate VaR. The scenario analysis
factored the effects of extreme weather
events into both aggressive and average
physical-risk scenarios. This physicalrisk scenario analysis reports an impact
on valuation that would come mainly
from tropical cyclones, extreme heat andcoastal flooding, which, taken together,would lower MSCI’s valuation by 1.27% in
an aggressive scenario.
We believe that the nature of MSCI’s
business as a service provider of tools
and solutions to the investment industry
helps limit the impact of many common
physical risks of climate change. We
believe that our geographic flexibility,
ability to adapt to potential climate
shifts, and support of net-zero goals will
help our efforts to limit the impact oftransition and physical risks stemmingfrom climate change.
Physical-risk scenarios are essential
to projecting the potential impact of
extreme weather caused by increased
levels of greenhouse gas emissions in
the atmosphere. Such scenarios model
the physical effects of changes in the
climate, including temperature andsea-level rise, as well as changes in
the frequency and severity of specificextreme weather events. MSCI ESG
Research has established the current
level of climate-related physical risk from
10 distinct hazards to physical facilities,
modeled how such risks may change

See Appendix 4 for information on the office locations for our employee population. For the scenario analysis included in this report, these values were used by MSCI ESG Research as an indicator of therelative size of MSCI’s global offices for purpose of the physical VaR assessment. This factor has resulted in a more tailored physical VaR assessment for MSCI Inc.
7

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under different climate scenarios, andprojected the impact of these hazards
for each physical facility.

FIGURE 6
OVERVIEW OF CLIMATE VaR ANALYSIS FOR MSCI 8
TRANSITION CLIMATE VaR
Policy Risk
DirectEmissionsElectricity
Use

Value
Chain

Low
IMAGE / SSP1
3.0°C Scenario
2.0°C Scenario

Mid-Range
AIM CGE-0.00%-0.00%-0.00%

1.5°C Scenario-0.00%

3.0°C Scenario-0.00%

2.0°C Scenario-0.00%-0.02%

1.5°C Scenario-0.04%

3.0°C Scenario-0.00%

2.0°C Scenario-0.00%

1.5°C Scenario
Technology Opportunities

1.5°C Scenario-0.02%-0.00%-0.05%

Low
IMAGE / SSP1

Mid-Range
AIM CGEFIGURE 7
MSCI’S AVERAGE EXPOSURE
TO PHYSICAL RISKS BY HAZARD

High
AIM CGE LATE

EXW VAR (%)-0.00%

Extreme Cold

+0.01

Fluvial Flooding-0.01

Extreme Heat

-0.22

Precipitation+0.01

River Low Flow

0.00

Extreme Snowfall

0.00

Tropical Cyclones-0.33

Wildfires

0.00

Extreme Wind

0.00

All

-0.66

-0.00%-0.00%-0.12-0.00%

Aggressive

Average

Coastal Flooding-0.18%-0.12%

Extreme Cold

+0.00%+0.01%

Fluvial Flooding-0.01%-0.01%

Extreme Heat

-0.26%-0.22%

Precipitation+0.00%+0.01%

River Low Flow--

Extreme Snowfall-0.00%+0.00%

Tropical Cyclones-0.92%-0.33%

Wildfires-0.00%-0.00%

Extreme Wind

-0.00%-0.00%

Aggregated Physical Climare VaR-1.27%-0.66%SOURCE: MSCI ESG RESEARCH, JUNE 2022

Coastal Flooding-0.00%

Physical Climate VaR= Aggregated Climare VaR
2°C Mid-Range & Aggressive
Physical Climate Risk Scenarios

PHYSICAL CLIMATE RISK OF THE
COMPANY BY HAZARD
The chart below illustrates the impact ofphysical risks expressed as a percentagechange of the net present value of theaffected company over the remainderof this century that could result fromthe aggregate effect of extreme weather
events. It shows that tropical cyclones,
extreme heat and coastal flooding present
the greatest risk to our facilities.

-0.06%-0.07%

3.0°C Scenario
2.0°C Scenario

High
AIM CGE LATE

-1.32%SOURCE: MSCI ESG RESEARCH, JUNE 2022

IMAGE/SSP1: Integrated Model to Assess the Global Environment/ Shared Socioeconomic Pathways. AIM CGE: Asia-Pacific Integrated Assessment Model/Computable General Equilibrium. AIM CGE Late:
Asia-Pacific Integrated Assessment Model/Computable General Equilibrium Late action. Average scenario: The average scenario is the probable change in physical climate risk and is calculated
by considering the expected average value of the cost distribution. Aggressive scenario / Worst case scenario: This represents a more severe future physical climate and is derived from the 95th percentile ofthe cost distribution and explores the most serious downside risk within the distribution tail.
8

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FIGURE 8OVERVIEW OF MSCI’S MAJOR OFFICE LOCATIONS WITH THE BIGGEST CHANGE IN EXPOSURE TO TROPICAL CYCLONESANNUAL RELATIVE DAMAGE (%)

2021

2040

0.008%

0.006%

0.005%

0.011%

0.024%

0.009%

0.007%

0.006%

0.013%

0.028%

Hong Kong

Shanghai

BostonTokyo

ManilaSOURCE: MSCI ESG RESEARCH, JUNE 2022

ACUTE PHYSICAL RISKEXPOSURE: TROPICAL CYCLONESThe graph above shows the major officelocations with the biggest change in
potential exposure to tropical cyclones.9
The current exposure is a measure oftoday’s average relative damage exposure
to the asset caused by tropical cyclones
in relation to the value of the asset. The
future exposure is a measure of theaverage relative damage exposure to theasset (in relation to the value of the asset)
in 2040 from tropical cyclones based on
the average outcome of a future physicalrisk scenario. If this value is higher thanthe current exposure to tropical cyclones,
the asset is projected to be exposed tomore frequent or intense tropical cyclone
events. MSCI ESG Research models therisk based on the difference between thecurrent exposure and future exposure.
ACUTE PHYSICAL RISKEXPOSURE: COASTAL FLOODING
The graph to the right shows major
office locations with the biggest
potential change in exposure due tocoastal flooding. The current exposure
is a measure of today’s average relative
damage exposure to the asset caused bycoastal flooding (in relation to the valueof the asset). The future exposure is ameasure of potential average relative
damage exposure to the asset (in relation
to the value of the asset) in 2040 fromcoastal flooding based on the averageoutcome of a future physical-risk scenario.

FIGURE 9
OVERVIEW OF MSCI’S MAJOR OFFICE LOCATIONS WITH THE BIGGEST CHANGE INEXPOSURE TO COASTAL FLOODING

2021
2040

0.0179%Shanghaiis estimated to have the biggest
change to coastal flooding out of
MSCI’s major locations

0.0002%
Shanghai

Locations with more than 40 full-time employees (as of Dec. 31, 2021.) are classified as major assets.
100.0000000490
110.0000000498

0.0000% 10

0.0000% 11

New York

9

SOURCE: MSCI ESG RESEARCH, JUNE 2022

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If this value is higher than the current
exposure to coastal flooding, the asset isprojected to be exposed to more frequent
or intense coastal flooding events. MSCIESG Research models the risk basedon the difference between the current
exposure and future exposure.

CHRONIC PHYSICAL RISKEXPOSURE: EXTREME HEATThe chart below shows the major officelocations with the biggest potentialchange to exposure due to extreme heat.
The current exposure is a measure of
the estimated number of days per year
in which the location may be exposed to
extreme heat. The future exposure is ameasure of the estimated number of daysin 2036 that the location asset could be
exposed to extreme heat based on the
average outcome of a future physicalrisk scenario. If this value is higher thanthe current exposure to extreme heat,
the asset is projected to be exposed tomore frequent extreme heat events in the
future. MSCI ESG Research models therisk based on the difference between thecurrent exposure and future exposure.
Our Business Continuity Planning andCrisis Management teams also monitor

2022 TCFD REPORT

27

locations for their exposure to various
physical hazards. Appendix 4 provides
information on the locations whichwere most exposed to tropical cyclones,
extreme heat and coastal flooding in 2021
according to the MSCI Climate VaR model.

While our commercial operations remain
unimpacted by the water shortage, ourBusiness Continuity Planning and Crisis
Management teams are monitoring thesituation and prioritizing actions to protect
the health and safety of our employees.

In addition to the extreme climate eventsassessed by the model, we proactively
monitor other issues that have thepotential to impact our employees and ouroperations. For example, as of the date ofthis Report, employees in our Monterrey,
Mexico, office are experiencing water
shortages across the metropolitan area
due to drought conditions and years of
below-average rainfall.

In addition, an example of how the Climate
VaR results directly influenced MSCI’s
business objectives and strategy is our
choice of a second location in Pune, India,
which is approximately 100 miles inlandfrom Mumbai and at a higher elevation.
We considered other locations such as
Hyderabad and Bangalore but decided on
Pune for several reasons, including thoserelated to longer-term climate risks.

16.3 days
average increase in days over 30°c in eachof MSCI’s major locations by 2036

FIGURE 10
OVERVIEW OF MSCI’S MAJOR OFFICE LOCATIONS WITH THE BIGGEST CHANGE IN EXPOSURE TO EXTREME HEAT

2021
2036

HEATING DAYS PER YEAR (ABOVE 30°C)

Shanghai

73.8

New York

59.5

Budapest

22.3

Hong Kong

139.4

Manila

262.5

85.6
71.9
35.8

SOURCE: MSCI ESG RESEARCH, JUNE 2022

156.3
289.4

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Risk Management
We are committed to ensuring that weare identifying, evaluating and managing
climate-related risks that may directly or
indirectly impact our operations or ability
to deliver our products and services.
Our management team has day-to-day
responsibility for identifying, assessing
and managing climate-related risks,
while our Board oversees management’s
execution of those responsibilities.

1) MSCI’S PROCESSES FOR
IDENTIFYING AND ASSESSING
CLIMATE-RELATED RISKS
Our processes for identifying andassessing climate-related risks are multipronged and seek to continuously capture
insights on risks we may face in the
coming years and decades.
We regularly engage with shareholders,clients and employees, and conduct
benchmarking analysis to identify themost relevant risks to our businessand industry. This includes an annual
roadshow with our shareholders that
focuses on corporate responsibility
issues to help us better understandtheir areas of interest, including climaterelated risks.

Our insights on climate-related risks are
informed by the TCFD guidelines as wellas the CDP climate questionnaire.
We use our Climate VaR model, whichaligns with the TCFD’s risk categories,
to identify and assess MSCI’s mostprobable climate-related facility-leveland enterprise-level risks. The annual
scenario analysis that we conduct aspart of the Climate VaR analysis allows
us to assess the impact of climate risks,
including physical and transition risks.
See Appendix 3 for additional details
on the methodology and scope of the
Climate VaR model.
We have categorized our climaterelated risks using the TCFD framework,
including Policy & Legal, Technology,
Market, Reputation, Acute Physical andChronic Physical risks. On a quarterly
basis, we arrive at an overall risk level(e.g., high, medium, low) for our climaterelated risks by considering these risks interms of potential likelihood and potential
impact. In this way, climate-related risks
can be viewed relative to other risks that
we manage and monitor as a firm.
We also consider climate-related risks
in terms of the time horizon of such an
impact—specifically, across the short(less than one year), medium (one tothree years) and long term (more than
three years). These time horizons alignwith our business, strategy and financial
planning. Please refer to Figures 3 and
4 for more information on how risks
outlined in the TCFD framework may
impact our firm in the short, medium
and long term.

We use our Climate VaR model, which aligns
with the TCFD’s risk categories, to identify andassess MSCI’s most probable climate-related
facility-level physical and enterprise-level risks

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We have developed different types of mitigation
strategies, involving different teams, to manage
climate-related risks depending on the typeof risks we face
We use both quantitative and qualitative
measures to assess the potential for
substantive strategic or financial impacts
from climate change, consistent withhow we evaluate the impact of other nonclimate change risks to our firm. If thereis the potential for a greater than USD$75 million USD annual impact to MSCI’s
Adjusted EBITDA, as defined in MSCI’s
financial statements, due to a climate issue,
this would trigger a review of additional
factors, including, but not limited to:— whether the potential impact requires
a significant change in our operations
and/or how we deliver our products toour clients— the need to make an extended or
permanent change in location of a
facility or implement our business
continuity plans beyond current
scenarios, and— whether the potential impact results
in a significant change to our, or ourclients’, business strategy.
We would deem a climate issue to have hada substantive financial or strategic impact
if one or a combination of the qualitative
factors met that threshold in addition to thequantitative factor. Currently, there are no
impacts that meet this definition.

2) MSCI’S PROCESSES FOR MANAGING
CLIMATE-RELATED RISKS
We have developed different types of
mitigation strategies, involving different
teams, to manage climate-related risks
depending on the type of risks weface. Our Business Resiliency team, forexample, assesses the severity, probability
and scale of potential extreme climate
events in geographies where we operate,and develops, implements and tests
technology systems to support MSCI’s
business continuity plans. See Figures 3
and 4 for a comprehensive descriptionof our mitigation strategy for each risk
outlined in the TCFD framework.
3) HOW CLIMATE-RELATED RISKSARE INTEGRATED INTO THE
ORGANIZATION’S OVERALL RISKMANAGEMENT
Our processes for identifying, assessing
and managing climate-related risks
are integrated into our firmwide risk
management framework, thereby ensuring
climate-related risks are treated with ahigh level of transparency, visibility andaccountability. This framework includes
both transition and physical risks.
As part of our firmwide risk management
framework, we prepare a risk dashboard
on a quarterly basis, which provides ahigh-level summary of our company’s

enterprise-level risks. This dashboard,which includes our climate-related risks(reflected in Figures 3 and 4) is sharedwith our EROC on a quarterly basis. We
also provide the EROC with risk-specificdetails, such as assessments of impact
and likelihood, key mitigating actions,and a set of metrics used to assess
and measure our progress in managing
climate-related risks (e.g., metrics on our
carbon footprint, our use of renewables,
and the percentage of our suppliers withclimate commitments).
Our Board is responsible for overseeing
the management of company risks,
including those that are climaterelated. The Audit and Risk Committee
receives a quarterly update from the
ERMO on, among other things, thework of the EROC. In addition, the CISO
periodically updates the Audit andRisk Committee on MSCI’s planningfor business continuity and IT disasterrecovery, which are designed to mitigate
the impact of potential disruptions,
including those that could be causedby extreme weather events and othereffects of a changing climate. In
addition, the Governance and Corporate
Responsibility committee receives
quarterly updates from the CRO, which
include metrics and progress on our
climate goals.

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Metrics and Targets
1) METRICS USED TO ASSESS CLIMATERELATED RISKS AND OPPORTUNITIESCLIMATE-TRANSITION RISKS:MSCI is committed to paving the way
toward a net-zero economy and believes thatlowering our carbon emissions may reduce
our exposure to transition risks and allow us
to capitalize on climate-related opportunities.
We measure our progress in meeting our
climate commitments by monitoring abroad range of climate-related metrics.
To measure and mitigate our Scope 1
and 2 emissions, MSCI tracks key metrics
associated with our energy consumption.
These allow us to identify trends in theeffectiveness of our actions and inform ourability to reduce our office footprint, choose
energy-efficient buildings and increase theuse of renewables.
Our supply chain constitutes the main
source of MSCI’s Scope 3 emissions.
See Strategy section 2 for details ourengagement with suppliers through our
Sustainable Supplier Management team. We
plan to use new sources of aggregated dataas they become available to help us achievea more complete understanding of our
suppliers’ corporate climate commitments.
Emissions from purchased goods andservices (PG&S) are quantified using aspend-based approach. This approach,outlined in the GHG Protocol’s Scope 3
Guidance, entails collecting data on theeconomic value of goods and services
purchased and multiplying it by relevant
secondary (e.g., industry average) emission
factors (e.g., average emissions permonetary value of goods).

FIGURE 11
KEY METRICS RELATED TO MSCI’S SCOPE 1 AND 2 EMISSIONS
2019

2020

2021

2019
to 2021

17%

53%

94%

77%

Reduction of Scopes 1 & 2 (Market)

-21%

-16%

-70%

-75%

Reduction of Scopes 1 & 2 (Location)

-9%

-6%

-13%

-17%

Energy Consumption
Percentage of Renewable Electricity
Carbon Emissions
Reduction Plan Indicators

Note: In September 2021, MSCI completed its acquisition of Real Capital Analytics, Inc. (“RCA”). All metrics detailed
above have been re-baselined for the acquisition of RCA unless otherwise stated.

FIGURE 12
KEY METRICS RELATED TO MSCI SCOPE 3 EMISSIONS
2019

2020

2021

27,762

27,34930,156-

29% 12

44% 12

2020

2021

2019
to 2021

-11%

10%

-2%

Supplier’s GHG Emissions(in metric tons of CO2e)
Purchased goods and services
Decarbonization Plan Indicators
Percentage of MSCI suppliers by spend that committed
to have science-based carbon-reduction targets

FIGURE 13
MSCI SCOPE 3 EMISSIONS CHANGESMSCI’s Scope 3 Emissions(MT C02e)14 Changes
Scope 3 Change

The 10% YoY increase in Scope 3 emissions
compared to 2020 was predominantly
driven by a higher level of purchased goods
and services as well as small contributions

from other Scope 3 categories. Thesehigher levels were somewhat mitigated bybusiness travel reductions resulting fromCOVID-19 restrictions.

This includes only those suppliers that had SBTi targets or commitments to setting such targets. For 2021, we additionally included any supplier that is also a member of GFANZ as they also have an implied
commitment to set science-based targets.
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31

CLIMATE PHYSICAL RISKS
MSCI’s Climate Risk Center, part of MSCIESG Research, annually runs a Climate VaRanalysis indicating key physical risks. We
use that analysis to monitor our exposure
to physical-risks in our locations and to
inform decision-making in connection withthe location of new offices. The scenario
analysis run in 2022 reported that MSCI’s
aggregate Climate VaR is -1.32%, whichmeans the company’s valuation can be
reduced by -1.32% in a 2°C mid-range andaggressive physical-risks scenario. Pleasesee MSCI’s 2020 TCFD Report here, for prior
Climate VaR analysis results.

of Dec. 31, 2021, from USD 106 billion ayear earlier. The Run Rate from ESG andClimate-related ESG Research and Index
products rose 58%, to USD354 million overthe same time period. Run Rate is a key
operating metric and is important because
an increase or decrease in our Run Rate
ultimately impacts our future operating
revenue over time. At the end of any
period, we generally have subscription andinvestment product license agreements inplace for a large portion of total revenue
for the following 12 months. We measure
the fees related to these agreements andrefer to this as “Run Rate.”

CLIMATE OPPORTUNITIESAs a leading provider of ESG and Climate
solutions, we play a role in supporting
climate investing. We anticipate suchinvesting will continue to grow in the
coming years as investors sharpen theirfocus on the risks and opportunities ofclimate change. As the charts below show,
the total assets in exchange traded funds(ETFs) link to MSCI ESG and Climate
Equity Indexes grew to USD 227 billion as2) MSCI’S GREENHOUSE GAS(GHG) EMISSIONSAs part of our commitment totransparency, we continue to calculate
and disclose MSCI’s greenhouse gas
emissions across all three emissions
scopes. These values are informedby the Greenhouse Gas Protocol and
we received third-party limited
assurance of our 2018, 2019, 2020
and 2021 emissions.

FIGURE 15
MSCI’S SCOPE 1, 2 AND 3 EMISSIONSIN 2021 (MT C02E)

Scope 1
Scope 2 (market-based)
Scope 3964
160

37,631FIGURE 16
MSCI’S 2019-2021 SCOPE 1, 2 AND 3
EMISSIONS (MT C02E)1
1- Verified with limited assurance; 2019 and2020 emissions have been re-baselined for the
RCA acquisition.

FIGURE 14
KEY MEASUREMENT METRICS RELATED TO CLIMATE OPPORTUNITIESScope 1

(US$ IN BILLIONS)

Scope 3

AUM: Assets under management		

Scope 2 (Market-based)
Scope 2 (Location-based)

ETF: Exchange-Traded FundAUM IN ETFS LINKED TO MSCI ESGAND CLIMATE EQUITY INDEXESFIRMWIDE ESG AND CLIMATERUN RATE
ESG & Climate Research$227

ESG & Climate Indexes
38,38734,140

7,767

7,360

37,631

$354
114%

58%

$154

$225
$106
$86

6,480

$200

$138

4196
272
Q4 2020

Q4 2021

Q4 2020

Q4 2021

2019

2020

3507

964

230

160
2021

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FIGURE 17
YEAR-OVER-YEAR CHANGE IN MSCI’S SCOPE 3 EMISSIONS(MT C02E)

Scope 3 Categories Evaluatedby MSCI That Are Not Relevant

We derived these values using the GHG Protocol’s Scope 3 Evaluator tool. This
tool generates high-level estimates using an underlying economic input-output
model database and contains a relatively high degree of uncertainty. MSCI
updated 2019 and 2020 Scope 3 carbon emissions calculation methodology
to disclose more precise figures.

CapitalGoods

MSCI’s internal databases do not differentiate
between capital goods and purchased goods &services. All relevant emissions are accounted
for in C1 - Purchased Goods & Services

Purchased Goods & Services
Transmission and Distribution
Business Travel
Employee Commute

UpstreamTransport

Not relevant—no goods are transported to MSCI
for creating products as we provide data andfiles to our clients

Upstream
LeasedAssets

Not relevant—MSCI does not have upstream
leased assets

Downstream
Transport

Not relevant—no goods are transported
downstream to customers

Processingof Sold
Products

Not relevant—MSCI does not sell products that
require further processing downstream as we
provide data and files to our clients

End of Life
Treatmentof Sold
Products

Not relevant—no physical goods are sold that
result in end of life emissions

Franchises

Not relevant—MSCI does not have franchises

Investments

Not relevant—MSCI is not a financial
services institution

Waste Generated in Operation
Use of Sold Products
Downstream Leased Assets

417

413

676

3,044

2,568
1,938
1,506

4,417

609

1,499

417

1,539

158

1,878

27,34930,156

2019

2020

2021

FIGURE 19
SCOPE 3 EMISSIONSINTENSITY PER REVENUE $M

2020

2021

2019

2020

10.7

1.0
17.8
Tonne CO2e per Employee

Tonne CO2e per Revenue $M

0.5

FIGURE 21
SCOPE 3 EMISSIONSINTENSITY PER EMPLOYEE

1.2
19.4

2.1

Tonne CO2e per Revenue $M

FIGURE 20
SCOPE 1 AND 2 EMISSIONSINTENSITY PER EMPLOYEE

23.8

2.8

2019

399

1,273

27,762

FIGURE 18
SCOPE 1 AND 2 EMISSIONSINTENSITY PER REVENUE $M

202

2021

0.3

2019

2020

2021

8.9

8.7

2020

2021

Tonne CO2e per Employee

1,938

2019

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FIGURE 22:
MSCI CLIMATE COMMITMENTS
Near-term Target

Long-term Target

Baseline

2019

2019

Target Date

2030

2040

Scope 1 & 2 Reduction

80%

Scope 3 Reduction

50%

Net-zero = at least 90%
reduction of Scope 1, 2
& 3 emissions

SBTi Verification

Pending

Pending

We have made progress against these commitments. (See “Tools for climate action,” p.2)

3) MSCI’S CARBONREDUCTION TARGETS
The disclosures and initiatives describedin this Report aim to help stakeholders
understand the plans and progress madeby MSCI to achieve our goal of net-zeroemissions across our value chain before

2040. That includes our commitment toaligning our climate trajectory with a 1.5°C
pathway. In 2022, we filed for verification by
the Science Based Target initiative (SBTi) ofenhanced near-term targets, reducing our
Scope 1 and 2 emissions by 80% and ourabsolute Scope 3 emissions by 50%, in eachcase by 2030 and from a 2019 baseline, andour long-term (net-zero) target by 2040. We
used the absolute contraction method to set
our science-based targets and included all
relevant Scope 3 categories in our near- andlong-term SBTi-aligned targets.
Also, MSCI ESG Research’s Implied
Temperature Rise tool models that our
net-zero target and future emissions
pathway would align with a temperaturerise of 1.3°C. This measure estimates theglobal rise in average temperature thiscentury if the global economy were toundershoot its remaining carbon budget
to the same extent as MSCI.
We anticipate that we will continue torefine our strategy to meet our goals. As
the targets detailed in this Report reflect,
MSCI strives to review and update theambition of our commitments to creating
a more sustainable world.

75% 17%94%
reduction of our Scope 1&2 market-based
emissions compared to 2019

reduction of our Scope 1&2 location-based
emissions compared to 2019

Betterunderstanding

increased use of renewables to achieve
94% renewable electricity in 2021

of our suppliers’
climate commitments

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Fortifying our pledge;building tools for asustainable future
As the world intensifies its focus on theeffects of climate change, we are fortifying
our pledge to shrink our own carbon
footprint while driving industrywide change
and playing an instrumental role in creating
market tools critical to a global transition.
The coming years mark a pivotal time
for action. The world’s largest owners
and managers of assets have committed
to align their portfolios with the goal of
limiting the global temperature rise to
1.5°C, to cut emissions by half in the next
eight years and to reach net-zero in thedecades that follow. Those commitments
now cascade to companies. We have taken
significant steps over the past year toachieve our goals and we plan to build onthat momentum.
At MSCI, we embrace our dual role asa responsible corporate leader setting

ambitious targets and as an innovator
helping investors better assess risk
and opportunities. We envision more
responsive companies and more informed
investors as we recalibrate our own
policies, products and services to alignwith global reduction goals. Ultimately, we
see an opportunity for more clarity and toarm clients with the lens to discover areas
to drive change.

At MSCI, we embrace our dual role as a
responsible corporate leader setting ambitious
targets and as an innovator helping investors
better assess risk and opportunities

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TCFD Guidelines Index
Governance
Recommendation

Specific disclosure

Pagea) Describe the board’s oversight ofclimate-related risks and opportunities

Processes and frequency by which the board and/or board
committees (e.g., audit, risk or other committees) are informed
about climate-related issues.

7-9,
39-40

Whether the board and/or board committees consider climaterelated issues when reviewing and guiding strategy, major plansof action, risk management policies, annual budgets and businessplans as well as setting the organization’s performance objectives,
monitoring implementation and performance and overseeing major
capital expenditures, acquisitions and divestitures.
How the board monitors and oversees progress against goals andtargets for addressing climate-related issues.

b) Describe management’s role inassessing and managing climate-relatedrisks and opportunities

Whether the organization has assigned climate-related
responsibilities to management-level positions or committees;
and if so, whether such management positions or committees
report to the board or a committee of the board and whether
those responsibilities include assessing and/or managing
climate-related issues.
Description of the associated organizational structure(s).
Processes by which management is informed about climaterelated issues.
How management (through specific positions and/or management
committees) monitors climate-related issues.

7-9,
40-41

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Strategy
Recommendation

Specific disclosure

Pagea) Describe the climate-related risks
and opportunities the organization has
identified over the short, medium andlong term.

Description of what they consider to be the relevant short-, medium-,and long-term time horizons, taking into consideration the usefullife of the organization’s assets or infrastructure and the fact thatclimate-related issues often manifest themselves over the medium
and longer terms.

10-18

Description of the specific climate-related issues potentially arising ineach time horizon (short-, medium- and long-term) that could have amaterial financial impact on the organization
Description of the process(es) used to determine which risks
and opportunities could have a material financial impact on theorganization.
Description of their risks and opportunities by sector and/or
geography, as appropriate.

b) Describe the impact of climaterelated risks and opportunities on theorganization’s businesses, strategy
and financial planning

Include the impact on their businesses and strategy in the following
areas:

19-23— Products and services— Supply chain and/or value chain— Adaptation and mitigation activities— Investment in research and development— Operations (including types of operations and location of facilities)
Describe how climate-related issues serve as an input to theirfinancial planning process, the time period(s) used and how theserisks and opportunities are prioritized. Organizations’ disclosures
should reflect a holistic picture of the interdependencies among thefactors that affect their ability to create value over time.
Organizations should also consider including in their disclosures theimpact on financial planning in the following areas:— Operating costs and revenue— Capital expenditures and capital allocation— Acquisitions or divestments— Access to capitalc) Describe the resilience of theorganization’s strategy, taking into
consideration different climate-related
scenarios, including a 2°C or
lower scenario

If climate-related scenarios were used to inform the organization’s
strategy and financial planning, such scenarios should be described.

23-27,
44-47

Describe how resilient their strategies are to climate-related risks andopportunities, taking into consideration a transition to a lower-carbon
economy consistent with a 2°C or lower scenario and, where relevantto the organization, scenarios consistent with increased physicalclimate-related risks.

23-27,
44-47

Where they believe their strategies may be affected by climaterelated risks and opportunities.

How their strategies might change to address such potential risks
and opportunities.

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Risk Management
Recommendation

Specific disclosure

Pagea) Describe the organization’s processes
for identifying and assessing climaterelated risks.

Describe their risk management processes for identifying andassessing climate-related risks. An important aspect of thisdescription is how organizations determine the relative significanceof climate-related risks in relation to other risks.

28-29

Describe whether they consider existing and emerging regulatory
requirements related to climate change (e.g., limits on emissions) as
well as other relevant factors considered.
Processes for assessing the potential size and scope of identified
climate-related risks.
Definitions of risk terminology used or references to existing risk
classification frameworks used.

b) Describe the organization’s processes
for managing climate-related risks.

Describe their processes for managing climate-related risks,
including how they make decisions to mitigate, transfer, accept
or control those risks.

29

Describe their processes for prioritizing climate-related risks,
including how materiality determinations are made within
their organizations.

c) Describe how processes for
identifying, assessing and managing
climate-related risks are integrated
into the organization’s overallrisk management.

Describe how their processes for identifying, assessing andmanaging climate-related risks are integrated into their overallrisk management.

29

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Metrics & Targets
Recommendation

Specific disclosure

Pagea) Disclose the metrics used by theorganization to assess climate-relatedrisks and opportunities in line with its
strategy and risk management process.

Provide the key metrics used to measure and manage climaterelated risks and opportunities.

30-31

Describe whether and how related performance metrics areincorporated into remuneration policies for material climaterelated issues.
Provide their internal carbon prices as well as climate-related
opportunity metrics such as revenue from products and services
designed for a lower-carbon economy.
Metrics should be provided for historical periods to allow fortrend analysis.
Describe the methodologies used to calculate or estimate climaterelated metrics, where not apparent.

b) Disclose Scope 1, Scope 2, and, if
appropriate, Scope 3 greenhouse gas(GHG) emissions, and the related risks.

Provide their Scope 1 and 2 GHG emissions and if appropriate, Scope
3 GHG emissions and the related risks.

31-33

Related, generally accepted industry-specific GHG efficiency ratios.
GHG emissions and associated metrics should be provided forhistorical periods to allow for trend analysis.
Describe methodologies used to calculate or estimate the metrics,
where not apparent.

c) Describe the targets used by theorganization to manage climate-relatedrisks and opportunities and performanceagainst targets.

Describe their key climate-related targets such as those related
to GHG emissions, water usage, energy usage, etc., in line with
anticipated regulatory requirements or market constraints or othergoals. Other goals may include efficiency or financial goals, financial
loss tolerances, avoided GHG emissions through the entire productlife cycle or net revenue goals for products and services designed fora lower-carbon economy.
Whether the target is absolute or intensity-based.
Time frames over which the target applies.
Key performance indicators used to assess progress against targets.
Describe the methodologies used to calculate targets and measures,
where not apparent.

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BOARD OVERSIGHT
Our Board works closely with management to provide oversight,
review and counsel relating to long-term strategy, risks andopportunities. In this role, the Board is responsible for ensuringthat the risk management processes designed and implemented
by management are functioning as intended and that necessary
steps are taken to assess, monitor and control key businessrisks. The Board performs these functions as part of its
regularly scheduled meetings and through its four standing
committees, each of which examines various componentsof risk, including climate-related risk, as part of its assigned
responsibilities. The Board’s four standing committees andthe climate-related oversight responsibilities of each of thesecommittees are the following:

function, in 2021, MSCI conducted board education sessions tostrengthen the Board’s expertise on climate, including sessions
on climate science, climate investing, climate reporting solutions
and net-zero commitments.

Appendix 1

GOVERNANCE AND CORPORATE RESPONSIBILITY COMMITTEE
Among its other responsibilities, the Governance and Corporate
Responsibility Committee (Governance Committee) is
responsible for overseeing MSCI’s policies and initiatives related
to corporate responsibility matters, including those related toclimate change. Our Chief Responsibility Officer (CRO) provides
written updates to the Governance Committee in advance ofeach quarterly meeting on MSCI’s corporate responsibility
efforts. These updates include dashboards that illustrate ourprogress against our climate targets and include metrics related
to greenhouse gas emissions, renewable electricity usage andour suppliers’ climate commitments. The MSCI Board also hasaccess to these updates. In addition, at least twice per year, theCRO presents to the Governance Committee on key initiatives
and management’s performance against our annual Corporate
Responsibility Operating Plan. In 2021, for example, she presented
to the Governance Committee MSCI’s net-zero commitment
and related target-setting and proposed plan of action to reducecarbon emissions. In 2022, she reviewed updated interim carbonreduction targets and related SBTi verification plans with theGovernance Committee. Following input from the GovernanceCommittee, the MSCI Board was updated on these matters. The
Governance Committee also oversees shareholder engagementon corporate responsibility matters, including participation by its
members in MSCI’s annual Corporate Responsibility Roadshow.
During the 2021 Corporate Responsibility Roadshow, ourshareholders focused the discussions on, among other things, ourcorporate responsibility practices and disclosures in light of beinga leader in ESG ratings and data, and on our climate initiatives.
The Governance Committee also oversees the MSCI Board
Education Program. In response to feedback from the MSCI
Board and to help the MSCI Board perform its oversight

AUDIT AND RISK COMMITTEE
The Audit and Risk Committee (Audit Committee) reviews MSCI’s
enterprise risk management program, including its risk governanceframework and risk management practices that facilitate theidentification, assessment, mitigation and public reporting ofrisks that may affect the company. On a quarterly basis, the Audit
Committee is updated on MSCI’s enterprise risk management
program by our Enterprise Risk Management Officer. The update
includes an overview of risks and emerging trends and is also
made available to the MSCI Board. In 2021, these discussions
included, among other things, consideration of initiatives andactions to improve business resiliency, address climate change
and acquire and manage key talent for our ESG and Climate
offerings. The Audit Committee is also updated quarterly on the
Company’s IT risk program by our Chief Information Security
Officer. As part of this review, the Audit Committee receives
updates about the results of assessments conducted by outsideadvisors who provide independent assessments of our IT risk
program and our response preparedness, including those that
could be caused by extreme weather events.
STRATEGY AND FINANCE COMMITTEEThe Strategy and Finance Committee (Strategy Committee)
monitors and provides guidance on our strategic objectives. Thesemay include sustainability-related partnerships and acquisition
opportunities, including those involving climate-related products

CORPORATE RESPONSIBILITY POLICY COMMITTEE

Chief Responsibility Officer
Chief Financial Officer
General Counsel
Chief Human Resources Officer
Chief Product Officer
Global Head of ESG Research

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and services. On a quarterly basis, MSCI’s senior management andStrategy and Corporate Development Team discuss partnershipand acquisition opportunities with the Strategy Committee. This
discussion focuses on MSCI’s strategic growth areas and regularly
includes review of opportunities for climate-focused products,
data and services. As part of these efforts, in October 2021, MSCI
announced the launch of an analytical tool in partnership with
Burgiss, a global, market-leading provider of data and analytics,
that enables institutional asset owners and managers to better
understand the impact of climate change on private asset
portfolios. This tool, the Carbon Footprinting of Private Equity
and Debt Funds, covered over 15,000 private companies in nearly
4,000 active private equity and debt funds as of April 30, 2022.

reviews the achievement of goals by our executive officers,
including our CEO, President and COO, CFO, General Counsel andChief Human Resources Officer.

The Strategy Committee also collaborates with the Board andmanagement team to set the agenda for the Board’s annual two-day
strategy session and to help identify strategic areas of focus forquarterly strategy discussions. During these discussions, the seniorleaders outline multi-year strategic priorities. In 2021 and 2022, theannual two-day strategy session included discussion of opportunities
relating to our ESG and Climate business. In 2022, a quarterly
strategy discussion was dedicated to the multi-year strategy for our
corporate responsibility initiatives, including meeting our near- andlong-term carbon-reduction targets. The strategy sessions culminate
in the approval by the MSCI Board of an annual operating plan,
which includes climate-related product and infrastructure plans
and investments and is subject to ongoing monitoring by senior
management, the MSCI Board and Strategy Committee.

Corporate Responsibility Policy Committee
In 2021, we restructured the governance of our managementlevel committees focused on corporate responsibility. We
created the Corporate Responsibility Policy Committee (theCRPC) to review strategically significant proposals on corporate
responsibility policies, actions and disclosures. Our CRO sets theCRPC agenda and members include our CFO, General Counsel,
Chief Human Resources Officer, Chief Product Officer andGlobal Head of ESG Research – all members of the CRPC are
members of MSCI’s Executive Committee. Several members of
the CRPC have extensive climate-related product and researchexpertise in the financial services industry. The CRPC meets atleast quarterly and in 2021 made recommendations to our CEO
around company-wide climate commitments, such as our netzero and carbon-reduction targets. The recommendations werealso prepared and reviewed in consultation with the GovernanceCommittee and the MSCI Board.

COMPENSATION, TALENT AND CULTURE COMMITTEEThe Compensation, Talent and Culture Committee (Compensation
Committee) is responsible for regularly reviewing and annually
approving the compensation awarded to our executive officers
and other members of senior management. The Compensation
Committee also oversees plans for talent management, including
talent acquisition and development, progression planning andcareer progression, to guide management on the company policies
relating to diversity, equity and inclusion, corporate culture, resource
allocation, resiliency and employee engagement.
In 2022, MSCI introduced climate-specific goals for eachof our Executive Committee members that are aligned withour commitment to climate change. We believe that theachievement of these goals will help us to reduce our carbon
footprint and make progress against our stated goal toachieve net-zero before 2040, as well as deliver on the climate
commitments made in connection with our role as a founding
member of the NZFSPA. The Compensation Committee annually

MANAGEMENT RESPONSIBILITIESThe following members of our management and managementlevel committees are responsible for the day-to-day managementof climate-related risks and opportunities. We are committed toa governance structure at the management level that promotes
transparency and ensures proper escalation procedures withrespect to climate-related issues.
CORPORATE RESPONSIBILITY COMMITTEESIn January 2022, our CRO relinquished her duties as Head of
Index to fully dedicate herself to the CRO role, underscoring thefirm’s commitment to corporate responsibility efforts, including
climate-related risks and opportunities. The experience attainedin her role as Head of Index, where she worked extensively
on our ESG and Climate index products, positions her well toengage MSCI’s key decision-makers and various stakeholders
on corporate responsibility-related actions, some of which may
ultimately be recommended to our CEO, President and COO and/or the MSCI Board. As a member of the Executive Committee,
she also brings corporate responsibility considerations tosenior leadership discussions on MSCI’s business strategy andoperations. She reports directly to our President and COO, whooversees investment in key strategic growth and operational
areas, including investments in climate-related opportunities andstrategies to mitigate climate-related risks.

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Corporate Responsibility Committee
The Corporate Responsibility Committee (CRC) meets monthly toconsider trends, share updates on the implementation of MSCI’s
Corporate Responsibility Operating Plan and review MSCI’s
corporate responsibility metrics that monitor progress on goals
such as carbon reduction. The CRC includes representatives fromrelevant functions, including Corporate Responsibility, MSCI ESG
Research, Information Technology (IT), Data Management, Client
Coverage, Corporate Services, Finance, Legal, Human Resources
and Diversity, Equity and Inclusion.

Our Crisis Management Team and Technology Services Operations
Management Team oversee all aspects of our disaster and recovery
response efforts, including protecting the general welfare and safetyof our employees, data centers, networks, applications supporting
business operations, communications systems and generaltechnology recovery following extreme weather incidents or natural
disaster. Our Internal Audit Team periodically reviews various
aspects of these programs to provide independent assessment andassurance to management and the MSCI Board.

ENTERPRISE RISK OVERSIGHT COMMITTEE
Our assessment and management of climate-related risks andopportunities, including transition and physical risks, is integrated
into our firmwide risk management framework and reporting.
The Enterprise Risk Oversight Committee, (EROC) chaired by our
CFO, provides oversight of MSCI’s risk management activities
to ensure that we are identifying, evaluating and managing
risks that may have an adverse impact on our ability to achieve
operational and strategic objectives. The EROC comprises several
Executive Commitee members, including MSCI’s President and
COO, CFO, General Counsel, Chief Human Resources Officer,
Chief Technology Officer, and the committee includes our Headof Internal Audit and Enterprise Risk Management Officer, to help
ensure well-rounded consideration of potential exposures.
Our CRO regularly updates the EROC on our progress in managing
climate-related risks, including key efforts to reach our carbonreduction targets. The results of climate scenario analyses
are also shared. Additionally, on a quarterly basis, the EROC isprovided updates, via our firmwide risk dashboard, on a set of
metrics used to assess and measure our progress in managing
climate-related risks (e.g., metrics surrounding our carbon
footprint, our use of renewables, the proportion of our supplierswith climate commitments, etc.).
The Enterprise Risk Management Officer updates the Audit
Committee quarterly on the work of the EROC, including its
consideration of climate-related risks.

BUSINESS RESILIENCY AND CRISIS MANAGEMENT
The Business Resiliency Team assesses the severity, probability
and scale of climate-related events, and implements and tests
technology systems to support our business continuity plans.
The Chief Information Security Officer, a member of our BusinessResiliency Team, periodically updates the Audit Committee on
our business continuity and IT disaster recovery plans, which aredesigned to mitigate the impact of potential disruptions, including
those that could be caused by climate and extreme weather events.

Our Head of Corporate Services, who reports directly to our Chief
Human Resources Officer, partners with our IT Team on businessresiliency and crisis management and assesses and manages
climate-related issues that impact our supply chain, real estateand environmental sustainability.
The Corporate Real Estate, Facilities, Strategic Sourcing andProcurement, and Business Travel Management teams that reportto the Head of Corporate Services have direct responsibility formonitoring climate-related issues associated with our day-today operations. Our Corporate Real Estate management teamis responsible for monitoring and managing our energy use andefforts to reduce energy consumption, including through leasing
office space in buildings with LEED, BREEAM or equivalentcertifications that relate to the design, construction and operationof high-performance, environmentally sustainable buildings.
In 2021, we created a dedicated Sustainable Supplier Management
team within our Global Strategic Sourcing Team to deepen our
understanding of the carbon emissions reduction commitments,
climate trajectories and environmental and social practices of
MSCI’s suppliers to further align our selection of suppliers with ourown corporate responsibility commitments.

CLIMATE ACTION NETWORKS
Our Head of Corporate Services and our facilities management
teams work with a series of employee Climate Action Networks
established in 24 MSCI offices around the world as of June 2022.
These local Climate Action Networks aim to increase awareness,engage local employees and manage local and regional
environmental issues, including climate-related issues.

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MSCI OFFICE LOCATIONSCountry

City

State/Province(if applicable)

Building
Address

USA

Berkeley

California

2100 Milvia Street, 94704

USA

BostonMassachusetts

75 Federal Street, 02110

USA

ChicagoIllinois311 S. Wacker Drive, 60606

MexicoMonterrey

Nuevo Leon

Av. Ricardo Margain #444, 66265

USA

New York

New York

7 World Trade Center, 250 Greenwich Street, 10007

USA

NormanOklahoma

201 David L. Boren Boulevard, 73072

USA

San Francisco

California

221 Main Street, San Francisco, 94105

PRC

Beijing

No. 6 Wudinghou Street, 100033

Hong Kong

Hong Kong

Three Pacific Place, 1 Queens Road East

South Korea

Seoul

Gran Seoul, Tower 1, 33 Jong-Ro, 03159

Philippines

ManilaZuellig Building, Makati Avenue, 1226

India

Mumbai

Nesco IT Park Building 3, Goregaon, 4000063

India

Pune

Panchshil Futura, Magarpatta City, 411028

PRC

Shanghai

166 Lu Jia Zui Ring Road, 200120

Singapore

Singapore

1 Raffles Quay North Tower, 048583

Japan

Tokyo

Sankei, 172 Otemachi, Chiyoda-Ku, 100-0004

Hungary

Budapest

Greenhouse, Kassak Lajos utca 19-25, 1134

GermanyFrankfurt am Main

An der Welle 5, D-60322

Switzerland

Geneva3 Place des Bergues, 1201

Switzerland

ZurichPrime Tower, Hardstrasse 201, 8005

UK

London10 Bishops Square, Spitalfields, E1 6EG

FranceParis

Washington Plaza, 29 Rue de Berri, 75008

SwedenStockholm

Kungsbron 2, 111 22

42

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MSCI DATA CENTER LOCATIONSPRIMARY DATACENTERS:HostCountry

City

State/Province(if applicable)

Address

EXA

Switzerland

GenevaChemin de l’Epinglier, CH-1217 Meyrin

STACK

Switzerland

GenevaChemin du Pré-Fleuri, CH-1228 Plan-les-Ouates

SwitchUSA

Las Vegas

Nevada5225 W. Capovilla Avenue, 89118

SwitchUSA

Las Vegas

Nevada4495 E Sahara Avenue, 89104

MICROSOFT AZURE DATACENTERS:Country

City

State/Province(if applicable)

Building Address

USA

Boydton

Virginia

101 Herbert Dr, 23917

USABlue Ridge

Virginia

8217 Linton Hall Road, 20136

USA

W. Des Moines

Iowa

8855 Grand Ave, 50266

USA

QuincyWashington

1515 Port Industrial Way, 98848

Singapore

1 Marina Boulevard, 018989

Japan East

Tokyo, Saitama

Ireland

Leopardstown

Netherlands

Middenmeer

Saitama Prefecture
DublinSouth County Business Park, 18 D18 P521
Agriport 601, 1775 TK

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Appendix 3
MSCI ESG Research’s Climate VaR Model aims to provide aquantitative, forward-looking analysis of how climate change
may affect a company’s market valuation. The AggregatedClimate VaR consists of the Transition Climate VaR and the
Physical Climate VaR.

TRANSITION CLIMATE VaR
The Transition Climate VaR captures both risks and opportunities
using the downside policy risk and the upside technology
opportunity (Policy Climate VaR + Technology Opportunity Climate
VaR). The Policy Climate VaR consists of three components, theDirect Emissions Climate VaR, Electricity Use Climate VaR andValue Chain Climate VaR.
POLICY CLIMATE VaR: RISKS
Direct Emissions Climate VaR (Scope 1)
MSCI ESG Research employs a top-down and bottom-up hybrid
methodology to calculate potential risks from future climatechange policies coming from countries’ nationally determined
contributions pursuant to the Paris Agreement. To calculate acompany’s costs associated with reaching emission-reduction
targets, the Policy Climate VaR risk methodology uses
technology and policy-based carbon price estimates extracted
from integrated assessment models. Each year, company- andlocation-specific GHG reduction requirements are multipliedwith annual carbon price estimates that are scenario-specific.
The model computes the “Direct Emissions Climate VaR,” which
identifies the companies that may be most at risk from theemissions-reduction requirements needed to reach long-termclimate stabilization targets.
Electricity Use Climate VaR (Scope 2)
MSCI ESG Research has developed a model to calculate thepotential risk that companies could face through their electricity
consumption in a climate-transition scenario. The model uses
scenario-specific electricity data obtained from IAMs and estimatesof the costs, coming from our Direct Emissions (Scope 1) Climate
VaR Model, passed through from electricity producers to final
consumers, to compute an “Electricity Use Climate VaR” metric.
Value Chain Climate VaR (Scope 3)
MSCI ESG Research has developed a model to calculate thepotential risk a company faces from activities embedded within
its value chain. A company’s Scope 3 footprint is separated into

upstream and downstream elements. A company’s exposure to
upstream emissions can add input costs whereas downstream
emission exposure can lead to a company’s loss in market share
due to shifts in demand. The model assesses both sides of the
supply chain independently to compute a company’s “Value Chain
Climate VaR.”TECHNOLOGY OPPORTUNITY CLIMATE VaR
MSCI ESG Research has developed a Low-Carbon Technology
Opportunity model based on a company’s current low-carbon
revenue streams and company-specific patent data. Recently
published patent databases allow an evidence-based view into thestrategic investments in research and development by companies.
Using granted, low-carbon patents as a proxy for low-carbon
innovative capacity, the Technology Opportunity model computes
a company’s “Technology Opportunity Climate VaR” to identify
which companies might benefit from the implementation of longterm climate stabilization targets on a global level.
PHYSICAL CLIMATE VaR
Physical climate scenarios define possible consequencesfrom increased concentration of greenhouse gas emissions.
The scenarios contemplate changes in global temperatures,
precipitation levels and extreme weather events. MSCI ESG
Research uses scenarios that consider current and future
developments in extreme weather between now and the endof the century.
The physical climate scenarios modeled by MSCI ESG Research
evolve over time and currently include the costs of extreme
weather events relating to extreme heat and cold, heavy
precipitation, heavy snowfall, wind gusts, tropical cyclones,
coastal (from sea-level rise) and fluvial flooding, river low flow
and wildfires.
Physical climate impacts vary greatly depending on geographicalpositioning. Hence, MSCI ESG Research employs global gridded
data for assessing physical impacts. To model high-resolution
spatial distributions of extreme weather impacts across the globe,
MSCI ESG Research has produced a global Cartesian grid with aresolution of up to 3” x 3” (approx. 90 meters in mid-latitudes) for
acute risks such as coastal and fluvial flooding. For chronic risks
such as extreme heat, a grid resolution of 0.5° x 0.5° is used. The
global coverage (reaching across all land covered area) has a cellwidth in mid-latitudes of around 50 kilometers.

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COST MODELINGTo quantify physical risks, MSCI ESG Research uses a risk
assessment framework, which can be represented at a highlevel as follows:

EXPECTED COST = VULNERABILTY * HAZARD * EXPOSURE

Vulnerabilty

Cost function

HazardExtreme weather

ExposureCompany facility

IMPLIED TEMPERATURE RISE
A company’s temperature is measured by starting with its
2°C-aligned carbon budget. A company’s absolute carbon budget
for Scope 1, 2 and 3 emissions is allocated based on global andsector budgets to companies and using revenue as a proxy for fairallowance share. We assume that emissions need to be net-zero by
2070, based on the IPCC Special Report Global Warming of 1.5°C.13
To calculate Implied Temperature Rise, we project each company’s
annual emissions through 2070, including any reduction targets.
For Scope 1 and 2, we use estimated emissions when reported
emissions are not available. For Scope 3, we use estimatedemissions to overcome inconsistencies in company reporting.
For emissions not covered by publicly available climate-related
targets, we assume a 1% annual emissions growth.

13

Special Report on Global Warming of 1.5°C, IPCC, https://www.ipcc.ch/sr15/

We then measure how much a company is projected to over- or
undershoot the allocated emissions budget. We use the sciencebased metric known as Transient Climate Response to Cumulative
Emissions (TCRE) to translate the relative budget overshoot which
can be translated into a degree of temperature rise. The Implied
Temperature Rise assesses the rise in average temperatures werethe entire global economy to have the same carbon budget overand undershoot as the company in question.

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Appendix 4

MSCI EMPLOYEE HEADCOUNT IN PHYSICAL OFFICES
As of Dec. 31, 2021, the total employee count at MSCI was 4,303.
The tables below provide a breakdown of our employee count inphysical offices by region and city with a 30-employee threshold.
Please note the location noted at “other” for each region refers to
employees in office locations below the 30-employee threshold aswell as employees designated “remote” or part of a location that
does not have a physical address.

Location

Employee
Count

Location

Employee
Count

Location

Employee
Count

APAC

2,039

Americas

1,263

EMEA

1,001

Mumbai

1,081

New York

422

Budapest

478

Manila368

Monterrey

370

London

273

Pune

310

Norman106

Stockholm

52

Hong Kong

67

Berkeley

76

Frankfurt

37

Shanghai

52

Boston50

Geneva37

Singapore45

Chicago

38

Paris

36

Tokyo

42

San Francisco

36

Zurich30

Beijing

30

Other

165

Other

58

Other

44

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Appendix 5
MSCI’S MOST-EXPOSED OFFICES TO EXTREME HEAT IN 2021

HEATING DAYS (>30OC) PER YEAR IN 2021

357

338
262

258
208

Singapore

Mumbai

ManilaPune

Monterrey

0.00550.0051

Shanghai

BostonMSCI’S MOST-EXPOSED OFFICES TO TROPICAL CYCLONES IN 2021

ANNUAL RELATIVE DAMAGE (%) DUE TO TROPICAL CYCLONES

0.02350.0106ManilaTokyo

0.0081

Hong Kong

MSCI’S MOST-EXPOSED OFFICES TO COASTAL FLOODING IN 2021

ANNUAL RELATIVE DAMAGE (%) DUE TO COASTAL FLOODING

0.00016

Shanghai140.0000000490

0.00004

0.00000 14

Stockholm

New York

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ABOUT MSCIMSCI is a leading provider of critical decision support tools and services for the global investment community. With over 50 years of expertise in research, data and technology,
we power better investment decisions by enabling clients to understand and analyze key drivers of risk and return and confidently build more effective portfolios. We create
industry-leading research-enhanced solutions that clients use to gain insight into and improve transparency across the investment process.

NOTES

Prior year emissions presented in this report may differ from those previously published due to retroactive recalculations made in accordance with the GHG Protocol.
(Greenhouse Gas Protocol. A Corporate Accounting and Reporting Standard. REVISED EDITION. World Resources institute. Copyright © World Resources Institute andWorld Business Council for Sustainable Development, March 2004 ISBN 1-56973-568-9. Page 35-37.
https://ghgprotocol.org/sites/default/files/standards/ghg-protocol-revised.pdf#page=37)

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