Coronavirus Round-up: Investors pressure pharma companies on cooperation

The latest news on the Covid-19 outbreak and responsible investment

More than 40 asset managers, pension funds and insurers – including Triodos, Australian Ethical, Boston Common Asset Management, PGGM and Mirova – have called for international cooperation within the pharmaceutical industry to combat Covid-19. The €2.4trn coalition led by Achmea, has drawn up an Investor Statement which will be sent to large pharmaceutical companies including Roche, Gilead and Johnson & Johnson. They have made six recommendations focused on employee safety, the development and provision of affordable worldwide healthcare products, collaboration across the sector, international cooperation, long-term research and payment of suppliers.

HSBC Global Research has suggested “relaxing patents for social good” during the current pandemic. In an ESG report titled COVID-19 accelerant to decentralised manufacturing, the investment bank said Covid-19 had severely disrupted supply chains and caused an increase in demand for medical equipment and treatments. It argues that localised manufacturing can meet demand challenges by utilising new, cheap and fast production technologies like 3D printers and AI-generated innovations. But currently, crucial products are protected by patents, and HSBC warns this may slow progress and potentially harm society. Already several governments have relaxed or invoked emergency patent suspension clauses.

In another report from HSBC Global Research, analysts claim Covid-19 presents pressure and opportunities to increase sustainability in the fashion industry. The pandemic is likely to lead to greater consumer conscience around sustainability issues, says the note, although customers are not expected to accept material price increases. The sharp move away from high-street sales to online ones as a result of widespread lockdown could present companies with a chance to low energy consumption, as long as transportation factors are managed responsibly, the authors suggest. HSBC also recommended that rental clothing platforms, repair services, and take-back schemes be launched to provide an additional revenue stream and advance compliance with potential future EU policy.

Any slowdown in progress on environmental and climate issues as a result of coronavirus will be short-lived, predicts sustainability specialists at Allianz Global Investors. According to a piece penned by Christian McCormick, Director, Senior Product and Sustainability Specialist at the firm, the environmental benefits of the lockdown – such as cleaner air and less traffic – will be highly publicised, incentivising governments and businesses to develop greener strategies. He also says that supply chains may shorten as a result of the crisis, and companies will come under close scrutiny for the way they handle employees, clients and governance topics like pay and corporate purpose.  

CalSavers has extended the registration deadline for their Retirement Savings Programme from June 30th to September 30th in response to COVID-19. The new $2.8m Californian pension scheme is aimed at private-sector workers who do not have access to a retirement plan sponsored by their employers.

The UN’s International Fund for Agricultural Development (IFAD) has committed $40m, through its Covid-19 Rural Poor Stimulus Facility, to support farmers and rural communities in the most vulnerable countries to continue growing and selling food during the pandemic.IFAD is now calling on the private sector, UN member states and foundations to help it raise at least $200m more.