Former RiskMetrics ESG chief, Ran Fuchs, leaves MSCI

Divergence over ESG strategy believed to have influenced departure.

Ran Fuchs, Head of Credit Risk at MSCI and former global head of RiskMetrics’ ESG/Sustainability Business, is leaving the company, can reveal. It is understood that Fuchs has not yet taken a position elsewhere.
Sources close to MSCI said there had been a divergence in views on the strategy for building MSCI’s nascent ESG business that lead to Fuchs’ departure.
Fuchs, who was formerly Director of the ESG Analytics unit of RiskMetrics was instrumental in the transfer of that business to MSCI when it was acquired by the index giant in March 2010, before he resumed a credit risk position post buyout. Fuchs joined RiskMetrics Group in June 2007 as the global head its Credit Risk Business following a career in risk management and derivatives trading. The sources said Fuchs had been looking particularly at how to develop ESG-based fixed income research and tools within MSCI, reflecting hisprofessional background. Last week, reported that MSCI had begun consulting with institutional investors on the possibility of developing global socially responsible indices as it looks to consolidate revenues within the ESG part of its business. Any new development would build on the 23 environmental, social and governance (ESG) indices that are the continuation of the KLD indices that MSCI acquired as part of its $1.55bn acquisition of RiskMetrics.
In the fourth quarter of 2010, MSCI reported that total revenues related to its Index and ESG (environmental, social and governance) had risen by $19.9m (27.8%) to $91.2m, with ESG products contributing revenue growth of $4.7m. Overall, MSCI’s group net income for the fourth quarter was $30.3m, up from $24.5m in the same quarter of 2009, while operating revenue rose nearly 80% to $213.3m.