ESG round-up: $11trn investor coalition backs Mining 2030 initiative

The latest developments in sustainable finance: NGFS underestimated role of physical risks, says Mauderer; NYC’s Lander writes to Tesla board on Elon Musk controversies.

CalSTRS, LGIM, CDPQ and the Australian Council for Superannuation Investors are among the $11 trillion investor coalition who have announced their backing of the Global Investor Commission on Mining 2030. The initiative, which aims to develop a vision for a socially and environmentally responsible mining sector by 2030, builds on the experience of the investor-led response following the 2019 Brumadinho disaster. Alongside announcing investors, the initiative unveiled members of its multi-stakeholder commission, which will contribute to the development of a vision for the future of mining. Members include representatives from the European Bank for Reconstruction and Development (EBRD), ING Bank, mining company Newmont, the Indigenous People’s Advisory Forum (IPAF), IndustriALL Global Union, London Stock Exchange Group (LSEG) and the Brumadinho community.

Central bank climate group NGFS “completely underestimated the role played by physical risks” when it began its climate work, according to Bundesbank executive board member Sabine Mauderer. Speaking at the European Occupational Pensions Authority annual conference, Mauderer highlighted the including of acute physical risks and geographical granularity in the NGFS’ fourth vintage of climate scenarios, but noted that the group had underestimated the role of physical risk when it began working. “Unfortunately, the experience of the last two years has shown that physical risks play an important role in Europe as well,” she said.

New York City comptroller Brad Lander has written to the board of directors at Tesla, expressing concern for CEO Elon Musk’s alleged support of antisemitic comments on Twitter and calling on it to take appropriate action to hold him to account. Musk has said the accusations of antisemitism are “bogus” and “could not be further from the truth”. The comptroller letter notes that previous comments by Musk have resulted in litigation. “If the board takes no action against Mr Musk, it sends a message to all Tesla employees that the behaviour of the company’s CEO is unassailable, the Company’s Code of Business Ethics is toothless and employees are free to take any action or utter any words, no matter how hateful or harmful,” it continues. New York City pension funds hold a total of $946 million in Tesla shares.

The EU’s financial watchdog ESMA has published three explanatory notes covering the definition of sustainable investments, application of do no significant harm (DNSH) and use of estimates. The notes do not provide new guidance but instead “aim at setting out factual information” regarding these concepts to help stakeholders better understand the sustainable finance legislative framework.

The European Bank for Reconstruction and Development (EBRD) has invested €20 million in Bank Polska Kasa Opieki’s (Bank Pekao) debut international green bond, as part of its its €500 million public placement of senior non-preferred bonds, to be listed on the Luxembourg Stock Exchange. The bond proceeds will be used to finance or refinance green projects under the Polish bank’s sustainable finance framework.

Indonesia has launched its Just Energy Transition Partnership (JETP) comprehensive investment and policy plan (CIPP), which provides a roadmap for the government and the International Partners Group (IPG) – co-led by the US and Japan – to achieve the objectives laid out in the JETP joint statement, announced last year. Under the joint statement, Indonesia committed to limit emissions, accelerate renewable energy development and set a goal to achieve net-zero emissions in the power sector by 2050. As next steps, the government and the IPG, supported by the JETP Secretariat, will work together to implement the CIPP. The IPG and GFANZ investors are also actively working to direct financing towards potential JETP projects.

Aussie super fund Rest has committed A$1 billion ($657 million; €602 million) to Quinbrook Infrastructure Partners for renewables and green data centres. The commitment looks to provide exposure to a range of assets, such as solar and battery projects and green data storage centres, including Quinbrook’s Supernode green data campus in Brisbane.

Norges Bank Investment Management (NBIM) has decided to revoke the exclusion of Serco Group. The company was first excluded in 2007 due to its production of nuclear weapons and its participation in the partnership AWE-ML, which was the operating company of the state-run British Atomic Weapons Establishment (AWE). Since the AWE-ML is now discontinued and activities have been transferred back to the state run AWE, the Council on Ethics has recommended there is no longer a basis for excluding the company.

Index tech company MerQube has partnered with ESG data firm Impact Cubed to create bespoke ESG indices. The collaboration will allow investors to create indices that “mirror their precise sustainability goals”, across more than 100 ESG factors.