Daily ESG Briefing: Ecuador creates sustainable finance initiative

The latest developments in sustainable finance

Ecuador has launched a sustainable finance initiative, the Iniciativa de Finanzas Sostenibles, backed by the Principles for Responsible Investment, UNEP FI, the International Capital Market Association, the Climate Bonds Initiative and WWF. Members include the country’s central bank, stock exchange, universities and securities regulator.

A new study from non-profit FCLTGlobal suggests that a downturn in R&D returns is a result of a shorter-term focus by public companies. Funding the Future: Investing in Long-horizon Innovation reveals that R&D spending faces a unique set of short-term pressures. FCLTGlobal, which stands for ‘focusing capital on the long term’, has also designed an interactive R&D Scenario Engine for companies to determine their optimal R&D allocation. 

New York State Comptroller Thomas DiNapoli and the Fire and Police Pension Association of Colorado have been appointed as co-lead plaintiffs in a lawsuit filed against the Boeing Company. The lawsuit alleges that current and former company heads breached their fiduciary duties by “dismantl[ing] their lauded safety-engineering corporate culture in favor of what became a financial engineering corporate culture”. The complaint is available here.

Schroders’ Climate Dashboard has reported that higher carbon prices and COVID-19 lockdowns have had little impact on the long-term trajectory of global temperatures, which remain on course to rise by 3.9°C as of the end of June 2020, unchanged from the previous quarter and much higher than the Paris Agreement target, despite carbon emissions significantly decreasing. 

Impax Asset Management has published a report looking at the implications of COVID-19 in the transition to a more sustainable economy. Impax says four structural changes stand to have long-term effects on business models: a heightened awareness of systems-level risks; exposure of supply chain vulnerabilities; changing behaviour because of social distancing measures; and an acceleration towards a digital economy. The full report is available here.

Boston Common Asset Management has said it is planning to engage with banks and real estate investors as an eviction crisis looms across the US, which is likely to disproportionately impact Black Americans and other minorities. 

The Institute and Faculty of Actuaries has signed the Green Finance Education Charter, which aims to act as a tool for collaboration between government and industry. The Charter was launched as part of the UK Government’s ‘Pathway to COP26’ event series in the run up to COP26 in 2021.