Daily ESG Briefing: Bank of Canada veteran warns of sustainability ‘mission creep’

The latest developments in sustainable finance

A former Deputy Governor of the Bank of Canada has warned the central bank against ‘mission creep’ as it finalises the review of its monetary policy framework. In a report for the CD Howe Institute, John Murray – who retired from Bank of Canada in 2014 – said that it should avoid adding policy goals explicitly tied to unemployment, inequality and climate change, warning that by “putting too much on the central bank, you risk eroding its independence, its effectiveness through monetary policy […] and taking responsibility away to a degree from those who really should be sharing it”. Bank of Canada is currently led by Tiff Macklem, who advised the federal government on sustainable finance in between his tenure as a Deputy Governor and his current appointment as Governor. 

The US Supreme Court has denied an appeal by Goldman Sachs on a class action lawsuit brought by the Arkansas Teacher Retirement System and others, sending the case back to a lower court to continue. The plaintiffs allege that Goldman “maintained an artificially inflated stock price by repeatedly making false and misleading generic statements about its ability to manage conflict”, and the bank had appealed over decisions by a lower court to assign it the burden of persuasion to prove a lack of price impact by its alleged misrepresentation and that the generic nature of the alleged misrepresentations was irrelevant to the inquiry.

Financial communications and marketing firm Prosek Partners has bought a “large” stake in ESG and impact investing consultancy Blue Dot Capital, it has confirmed. The two firms have been working in partnership for the past two years, and Prosek said that the combination would allow them to “offer the full spectrum of ESG advisory services”.

A group of legal experts from across the globe has drawn up a definition of ‘ecocide’, which they intend the International Criminal Court to adopt in order to prosecute the worst offences against the environment. The draft law defines ecocide as “unlawful or wanton acts committed with knowledge that there is a substantial likelihood of severe and widespread or long-term damage to the environment being caused by those acts”. France has expressed support for an ecocide law, and a number of Pacific and Indian Ocean island nations have called for “serious consideration” of criminalising ecocide.

The majority of new renewables produce cheaper power than the least expensive fossil fuels, according to a new report by the International Renewable Energy Agency (IRENA). Of the 261GW of renewable capacity added last year, 62% had lower costs than the cheapest new fossil fuel option, with costs for concentrating solar power falling by 16%, onshore wind by 13% and offshore wind by 9%. IRENA said that the falling cost of renewables gives emerging markets a strong business case to ditch coal in favour of renewables projects.

The Buffalo Sewer Authority has raised $54m from what it claims is the largest ever Environmental Impact Bond in the US. The ten-year bond will be used to finance green stormwater infrastructure, and the authority will have the option to refinance or retire the bond in year seven or later if it meets a target of 200 acres of impervious surface area implemented with bond proceeds.