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Daily ESG Briefing: Kempen publishes new climate change policy

The latest developments in sustainable finance

Kempen Capital Management has published a new climate change policy, setting out key objectives to enable it to meet a net-zero target by 2050. In the short term, the asset manager aims to increase investment in green bonds, a sharper focus on active management of climate commitments, and widening exclusions to cover coal and tar sands, which it aims to achieve by 2022.

EDF and Standard Chartered Bank have signed a €200m revolving credit facility, incorporating a pricing adjustment mechanism that links the margin to three of the France-based utility group’s sustainable development KPIs [key performance indicators]: direct CO2 emissions, electrification of its vehicle fleet, and French residential customer usage of online consumption monitoring tools.

Carmignac, the France-based asset manager, has launched a system to integrate ESG research into the investment process for all its funds. It is called START (System for Tracking and Analysis of a Responsible Trajectory) and combines third-party data sources with in-house human-driven assessment.

The UK government should introduce an Investing in Ethnic Founders code to mirror the Investing in Women Code, as part of a range of measures to ensure more equitable access to venture capital funding, according to Extend Ventures. In Diversity Beyond Gender, the data firm which promotes diversity found that in the last 10 years Black founders received just 0.24% of venture funding and female founders only 11% of venture funding. 

Bundesbank President Jens Weidmann has written to NGO Finanzwende (Finance Watch Germany) saying climate-related transparency requirements should be considered in central banks’ asset purchase programmes or collateral frameworks. He also said climate-related risks in ratings could become a possible criterion in the decision making on securities to purchase or accept as collateral.

The World Bank has published a report on sovereign debt and ESG. Riding the Wave: Navigating the ESG Landscape for Sovereign Debt Managers provides a road map for sovereign issuers to navigate the world of ESG investing and also highlights the various approaches to ESG that a sovereign issuer can take. 

New York City Council is facing a motion to endorse the Fossil Fuel Non-Proliferation Treaty. It has been brought by Council Member Costa Constantinides and if passed, it would mean New York would become the biggest city to support the Treaty, which aims to stop the expansion of oil, gas, and coal while increasing international cooperation to advance an equitable transition to clean energy and low-carbon solutions. 

UK-based carbon tracking start-up Emitwise has secured $3.4m from Silicon Valley investors, including former Uber CEO Ryan Graves’ Saltwater Capital, Social Impact Capital and Ashby Monk, the institutional investment academic who is executive and research director of the Stanford Global Projects Center. 

Equinor, the Norwegian energy company, has set a new net-zero ambition which covers scopes 1, 2 and 3 following a shareholder proposal from campaign group Follow This. But Equinor expects to deliver an average annual oil and gas production growth of approximately 3% from 2019 to 2026. Follow This founder Mark van Baal said: "Now that the long-term, non-committal ambition is set, we need to see concrete targets, especially in the medium-term. Equinor's plans to grow in oil and gas fall short of Paris alignment. Every viable Paris-aligned pathway dictates lower emissions in this decade."

Exxon Mobil Corp says it may cut its global workforce; the oil company said it could be approximately reduced by 15%, the equivalent to 14,000 jobs out of its 88,300 employees, as the COVID-19 pandemic knocks energy demand and prices. 

The Better Buildings Partnership not-for-profit group has published a Net Zero Carbon Pathway Framework. The framework sets out the information that property owners should include in their pathways, including the investment boundaries, carbon scope, and delivery strategies.

Over the past four years, more publicly held U.S. companies than ever before have adopted “sound transparency and oversight practices for their political spending”, according to the 2020 CPA-Zicklin Index. However, despite the substantial progress, work remains for companies to be able to navigate political spending safely.

The OECD has developed a policy guidance tool for infrastructure investment called the OECD Compendium of Policy Good Practices for Quality Infrastructure Investment.

Italy’s Enel has committed to an 80% reduction in its direct greenhouse gas emissions per kWh by 2030, from a 2017 base-year. The Science Based Targets Initiative, an organisation that validates corporate decarbonisation strategies, has confirmed that it is the first major, global, integrated utility to set an emission reduction target consistent with the United Nations pledges to limit global warming to 1.5°C above pre-industrial levels and to achieve net zero emissions by 2050.