RiskMetrics Group announced today that it will acquire Innovest Strategic Value Advisors. RiskMetrics is a leading provider of risk and corporate governance services to participants in the global financial markets. Headquartered in New York, Innovest is a leading provider of sustainability research for the institutional investment community.

The acquisition of Innovest and its team of experts, led by co-founders Dr. Matthew Kiernan and Hewson Baltzell, enlarges RiskMetrics footprint in the environmental, social and governance research space at a time when the financial community's interests in sustainability are growing. Established in 1995 with the mission of integrating sustainability and finance by identifying nontraditional sources of risk potential for investors, Innovest specializes in analyzing companies' performance on environmental, social and strategic governance issues. The acquisition will bring together two established firms with deep expertise in the newly emerging field of climate governance and carbon management.

"A myriad of long-term sustainability factors, particularly around climate change, are playing an increasingly important role in the way funds invest and view their portfolio risk," said Ethan Berman, chief executive officer of RiskMetrics Group. "Innovest is one of the few firms that has successfully taken a quantitative approach to assessing ESG issues, thereby helping investors view what are typically intangible, compliance-oriented issues through a clearer financial lens."

RiskMetrics currently provides ESG research, data feeds and portfolio screening tools to global institutions that have a need to comply with clients' sustainability investing mandates. With the acquisition of Innovest, clients will have access to an ESG analyst team of more than 50 research professionals and an integrated environmental, social and governance suite of research and compliance-focused services.

Innovest had $7 million in revenue last year and is expected to contribute more than $2 million of adjusted EBITDA to RiskMetrics. The transaction is expected to close next month.