By William Cox
Ryanair Holdings plc. (RYAAY), the leading European low-cost airline, takes the top spot in 2023 ESG performance in a Yieldrive study of 18 airlines.
In the study Delta scores 2nd and United 7th in terms of financial ESG (Environmental, Social and Governance) performance.
The Yieldrive analysis calculates the financial impacts of ESG efforts and also factors in financial performance.
Ryanair stood out for its ability to employ ESG to effectively drive its revenues and margins. ESG was seen to bolster 24.75% of Ryanair’s revenues and 18.81% of its margins.
Under “environment” it stood out for managing its energy costs, implementing a digitalization plan and managing its environmental risks.
In the “social” category, Ryanair excelled in customer numbers and for access to affordable services.
Its strengths under “governance” included low litigation costs, data security, employee ethics program, and relatively low IT costs.
By comparison, United’s pay out from its ESG investments was 3.42% of revenues and 3.60% of margins.
Another interesting result of Yieldrive’s analysis of Ryanair is that the airline seems very unlikely to use ESG for greenwashing purposes. This is the result of high ESG performance coupled with factual reporting. This suggests that Ryanair is only reporting ESG facts which really matter.
Yieldrive is an AI-driven fintech company which calculates the financial impacts of ESG on companies on a quarterly basis. The scores are the basis for Yieldrive calculating the financial impacts of ESG on such indicators as fair value, cost of equity capital, revenues, margins and earnings per share for Q4/2023. These data are for equity research purposes and do not in any way constitute buy or sell recommendations.
Dr William Cox is CEO of Yieldrive AG in Zug/Switzerland.