How exposed companies are to Scope 1 and 2 greenhouse gas (GHG) emissions and how well they manage the risks related to transitioning to a low carbon economy can pose varying degrees of ESG risks to investors’ portfolios. Sustainalytics’ ESG Risk Ratings assess this risk through an analysis of the carbon own operations material ESG issue (MEI). Carbon own operations refers to a company’s management of risks related to its own operational energy use and GHG emissions (Scope 1 and 2). In addition, the evaluation of this issue also includes parts of Scope 3 emissions, such as transport and logistics.