Daily ESG Briefing: State Street joins CA100+

The latest developments in sustainable finance

State Street Global Advisors has become the latest signatory to Climate Action 100+, bringing the shareholder engagement network to 545 investors, with $52trn in assets under management. The announcement will increase pressure on Vanguard, the last of the world’s three largest asset managers – State Street, BlackRock and Vanguard – not to join the initiative. BlackRock signed up earlier this year. Vanguard did not respond to RI’s request for comment at the time of publication.

Barclays has fleshed out its plans to become Net Zero by 2050, but campaign groups are not convinced by the update. The UK bank launched its ‘BlueTrack dashboard’ to monitor financed emissions using a ‘carbon limit’ that will decrease over time, but NGO Market Forces said the announcement “does nothing to put Barclays on a path that would actually meet its net-zero emissions by 2050 target”. “We’ll simply get a much clearer picture of how they’re investing in climate catastrophe,” the group continued,  highlighting claims that between January and September this year, Barclays increased its fossil fuel funding compared to last year. Fellow NGO ShareAction, whose shareholder resolution earlier this year prompted Barclays’ Net Zero commitment, welcomed the update, but told the bank to use “a climate scenario that matches its ambition”. “Barclays uses the IEA’s Sustainable Development Scenario, which reaches net zero 20 years after Barclays hopes to do so,”  it explained in a statement. 

HSBC Global Research estimates that green bonds will reach up to $360bn for 2021, representing a 33% increase on 2020. Catching up quickly, social and sustainability bonds are expected to hit $220bn, it said. Green Bond and ESG Outlook also identifies five sectors where ESG threatens credit quality: Autos, Industrial Goods & Services, Oil & Gas, Travel & Leisure, and Utilities. 

Increased investor focus on stewardship through voting and engagement is driving sustainable investment and influencing corporate behaviours in China, according to Fidelity International. In a report on the topic, the asset manager also found that corporate ESG disclosure, although not mandatory in China, is growing: in 2019, 945 onshore firms disclosed their ESG performance in Corporate Social Responsibility reports, accounting for more than a quarter of A-share companies. This is up from 801 in 2017. The trend is partly due to China’s recent move to open up its onshore market to international players, which has brought with it new stewardship expectations, says the report. 

Macquarie’s Green Investment Group has acquired a majority stake in Vibrant Energy Holdings for an undisclosed su, via its renewable energy development platform, Blue Leaf Energy Asia. The purchase of the energy solutions provider from ATN International represents Blueleaf Energy’s entry into India.