Rhodium’s China Military-Political-Economic Risk (MPER China) solution supports global investors to efficiently manage investment, legal, and reputational risk related to their China portfolios. Our proprietary framework quantifies security issuers’ affiliation with problematic practices in the military, political, and economic domains and monitors potential exposure to evolving China controversies.
China has become an important component of global, diversified investment portfolios, but the autocratic nature of China’s economic and political system creates legal and ethical challenges for global investors. Traditional ESG metrics are insufficient to respond to these challenges, as they fail to capture an entity’s entanglement with geopolitics. Rhodium’s MPER framework combines proprietary data streams (Fundamental Risk, Sanctions, and Controversy Exposure) with tools to interpret them (Issuer Screening and Portfolio Benchmarking), allowing investors to screen their portfolios and ensure they align with their values and mandates.
Our MPER China solution combines Rhodium’s deep China economic and financial research experience with an innovative data framework and proprietary technology. Our Fundamental Risk scores quantify security issuers’ risk arising from their autocratic military affiliation (M), autocratic political affiliation (P), and affiliation with illiberal economic practices (E), as well as direct and indirect exposure to major sanctions and red-flag regimes. Our Controversy Exposure data quantifies issuers' links to China Controversies and functions as an early warning indicator for emerging reputational and legal risk.
Rhodium’s MPER solution allows investors to audit their China portfolios for risk and value misalignment, conduct due diligence and risk screening for individual PRC security issuers as a complement to existing ESG data, and benchmark their portfolios against other indices and funds with a China focus. Rhodium’s MPER team also supports clients with bespoke research and advisory on China financial de-risking.
