ESL has revealed the Esports World Ranking system for Dota 2, similar to their version for CS:GO, and the Main Ranking (or Power Ranking) shows the power of each current roster, being used for seedings and invitations.
Points are awarded to the players, and will decay over time, disappearing entirely after six months. Tournaments are rated by quality too, with The International being AAA while others are lower, as well as quanity of participants and size of the offline portion, determining how many points are awarded.
Points aren't transferrable, and will always stay with the player, although they can't earn points for more than one team in the same competition. There are also strict rules as well, as the five players "clearly" in the standard lineup at a competition's end get points, and if it's not clear, then the five players who participated most get the points.
It's important to note that the Power Ranking position of a team is determined by the sum of decayed points of their best five active players.
As for which tournaments impact rankings, these need to follow the basic agreed rules and fair play, have a size of at least 'Tiny' (a total of four participants and at least three of the top 24 in Power Ranking at the start of the tournament), are not competitions whose main purpose is to qualify somewhere else, nor should it be a tournament created with the sole purpose of getting points.
If teams are tied, the roster that has played together the longest is ahead, and for a full breakdown of all the points players can get, head this way.
Is this a good system?