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Daily ESG Briefing: Bank of America launches group to minimise climate impact

The latest developments in sustainable finance

Bank of America has launched an ESG Strategic Council for its EMEA operations. The council will work to minimise the bank’s impact on climate, manage climate risk and support its clients in their Net Zero transition, and will be led by Fernando Vicario, CEO of Bank of America Europe and Julian Mylchreest, Executive Vice Chairman of Global Corporate and Investment Banking.

Denmark’s central bank has warned that more than DKK40bn (€5.4bn) of loans are exposed to flood risk, with the figure potentially rising to DKK198bn by the end of the century. Property in low lying areas used as collateral for bank loans may decrease in value or become entirely worthless due to flooding, which the bank says may present “a risk for individual credit institutions as well as the financial system”.

The Principles for Responsible Investment has hit 4,000 signatories, driven by increasing participation from emerging markets – especially China and across Latin America and Central and Eastern Europe – it has said. More than 1,000 institutions have signed up over the past year, compared with the six years it took the PRI to reach its first 1,000 signatories. Today, governance, risk and compliance advisor  ACA Group announced it had joined the PRI, having launched an ESG practice in January.

Law firm FisherBroyles has launched an ESG Advisory Group to advise financial institutions and companies on ESG-related compliance, strategic planning and risk mitigation. 

Vanguard has said it is likely to support management-led ‘Say on Climate’ proposals if the company has identified material climate risk and is seeking shareholder input. Say on Climate gives shareholders a vote on corporate decarbonisation strategies at AGMs. In an article published on Harvard Law School’s website, the passive investment titan’s Global Head of Investment Stewardship, John Galloway, said it will also back Say on Climate proposals filed by shareholders if there are gaps in companies’ current practices. 

A coalition of development finance institutions including the European Investment Bank, the private sector arm of the African Development Bank and G7 development finance institutions have said that they will invest $80bn across Africa’s private sector over the next five years to support sustainable economic growth. This pledge is the first time that the G7’s development finance institutions have made a joint commitment on investment in Africa.

The Singapore stock exchange has launched what it claims are the world’s first ESG derivatives for Real Estate Investment Trusts (REITs), based on an index of 60 Tokyo-listed REIT stocks tilted using ESG ratings from GRESB.