(Bloomberg) -- Several months after the US government began investigating an Abbott Laboratories baby-formula plant for its connection to the deaths of at least two infants, the world’s most influential judge of corporate environmental, social and governance practices upgraded the company.

MSCI Inc., whose scoring system directs an estimated 60% of retail investments in ESG funds, raised Abbott’s rating on Aug. 25 two notches to A from BB. MSCI cited corporate governance improvements for the upgrade, as well as a broad changes to the way it rates companies that benefited larger health care firms, including Abbott.

The upgrade offers another example of how ESG ratings can diverge significantly from a firm's real-world track record on product safety, climate change, or other issues that pose real risks to investors.

In February, Abbott recalled popular formula brands such as Similac after US Food and Drug Administration inspectors found a deadly bacteria at a Michigan factory where the products were made. Four infants had been infected with the bacteria, two of whom died, and a whistleblower alleged management was more concerned with production numbers than safety.

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Abbott has said there is no definitive evidence linking its formula to the deaths and illnesses. The FDA closed its investigation saying it couldn’t rule formula in or out as the culprit, which is often typical of such probes. At least three dozen families have filed lawsuits against Abbott claiming product liability, fraud and negligence. And Abbott is operating under an agreement with the US Department of Justice that gives the FDA greater oversight of how the factory operates.

In a court document, DOJ described three managers and Abbott as being “unwilling or unable to implement sustainable corrective actions to ensure the safety and quality of food manufactured for infants.” On Wednesday, Massachusetts Democratic Senator Elizabeth Warren said the problems had been going on for years and asked Abbott to provide a list of lawsuits against it related to contaminated formula since 2003, as well as details of any settlements and non-disclosure agreements.

MSCI says its ratings are tied to “relevant ESG risks” and measure how factors such as regulations and legal judgments can affect corporations. They don't measure the risks companies can pose to society and the environment. Bloomberg LP, the parent company of Bloomberg News, competes with MSCI and other data providers to sell ESG ratings and data to money managers.

“Product safety and quality is a primary consideration overall in MSCI ESG ratings for the health care sector,” said MSCI spokesperson Melanie Blanco. “Abbott has faced several severe and moderate product recalls over the last three years, multiple regulatory warnings, and its infant formula recall continues to weigh heavily on its overall product safety and quality performance.”

MSCI noted that the manufacturer’s board no longer included “ overboarded directors”—those that sit on more than four public boards—and that may bolster management oversight.

The board’s independent majority enables it to “more effectively fulfill its critical function of overseeing management,” MSCI said. The firm’s report added that “we no longer flag the company for leadership concerns,” following last year’s resignation of long-time Chairman and Chief Executive Officer Miles White.

“Our improved rating better reflects our strong performance across ESG and our broad base of businesses, and is consistent with similar ratings where we’re among the top performers in our industry,” Abbott spokesperson Scott Stoffel said in an email.

(Abbott’s ESG rating went from BB to A, a change of two notches, not one as was reported in an earlier version of this story.)

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