ESG round-up: MEPs reject resolution to water down ESRS

In a vote in the European Parliament on Wednesday, MEPs rejected a resolution calling for limitations on the European Sustainability Reporting Standards (ESRS). The decision saw 359 MEPs vote against the resolution to water down the standards, 261 vote in favour, and 11 abstain. The cross-party motion, which was tabled by 44 MEPs last week, argued that the ESRS could not enter into force without significant reduction in the quantity and complexity of the reporting requirements.

The UK government has called for evidence on Scope 3 emissions reporting as part of its green finance strategy. The consultation is seeking views on the costs, benefits and practicalities of Scope 3 reporting to help inform the government’s decision on whether to adopt the International Sustainability Standards Board’s (ISSB) standards in the UK. It has also requested feedback on the current reporting framework to inform a post-implementation review of the policy. The deadline for submissions is 14 December.

Germany’s Bank für Kirche und Caritas (BKC) has published a draft model for measuring the impact of investor engagement. In a report on the results of a collective engagement effort with Brazil by Catholic investors, BKC put forward the model based on the “input, output, outcome, impact” framework already established in impact measurement. It is inviting feedback on the system.

The Taskforce on Social Factors convened by the UK’s Department for Work and Pensions (DWP) has put out for consultation a guide to considering social factors in pension scheme investments. The taskforce was established following a DWP consultation in February on consideration of social risks and opportunities by pension schemes. The deadline for feedback is 1 December.

The Warsaw Stock Exchange (GPW) has updated its ESG reporting guidelines for issuers. The guide aims to help Polish listed companies prepare for increasing EU regulatory requirements and further develop sustainable finance in the country. The guidelines were first issued in May 2021.

The Monetary Authority of Singapore (MAS) has issued net-zero transition planning guidelines for financial institutions. The guidance set out MAS’s supervisory expectations for a transition planning process “to enable effective climate change mitigation and adaptation measures”. Key expectations include engagement rather than divestment; taking a multi-year approach to “facilitate a more comprehensive assessment” of climate-related risks; holistic treatment of climate risks; considering environmental risks beyond climate; and good transparency.

Deutsche Bank has published its initial transition plan, with new emissions targets for loans to the coal mining, cement and shipping sectors. The German banking giant is aiming for a 49 percent reduction in Scope 3 financed emissions by 2030 for its coal loans, a 29 percent reduction in Scope 1 and 2 intensity for cement, and net-zero Scope 1 emissions in the shipping sector. Targets for the aviation sector will be set after the publication of a decarbonisation pathway by the Rocky Mountain Institute, expected in January. The bank said it would assess the social implications of its transition plan in more detail over the coming years, as well as looking to set Just Transition KPIs.

Adoption of Say on Climate Votes in Canada appears to be losing momentum, according to Canadian pension giant CPPIB. In its responsible investment report, published today, the C$575 billion ($419 billion; €397 billion) fund said it viewed Say on Climate votes as “inconsistent with the roles and responsibilities of owners, directors and managers”. In our role as a shareholder, we respect that companies we invest in determine their own specific climate-related transition strategies,” it added. The group supported 26 climate shareholder proposals in the 12 months to end-June, as well as 12 requests for independent third-party reviews of racial equity or civil rights and nine relating to DE&I more broadly.

In other voting news, the Pension Protection Fund released its responsible investment report for 2023. The UK’s £32.5 billion ($39.4 billion; €37.3 billion) lifeboat fund approved 54 percent of Say on Climate votes in 2022, a decline from 78 percent in 2021 which was attributed to a lack of improvement by companies. The PPF opposed management at least once at 68 percent of shareholder meetings. For the coming year, it detailed plans to conduct a review of its ESG service providers and detailed analysis of the sustainability profiles of its bank counterparties, as well as increasing its involvement in collective engagement initiatives.

The Association of Chartered Certified Accountants (ACCA) has published a report evaluating the challenges in ensuring that sustainability reporting is not undermined by poor technical or ethical practices. The report is intended to support accountants and non-accountants in managing dilemmas presented by greenwashing risk, weak processes, lack of technical knowledge and compromises on objectivity and independence.

The Climate Governance Initiative (CGI) has launched the 30th chapter in its network for Mauritius. The chapter has been launched by the Mauritius Initiative of Directors (MIoD) and one of its founding members, HSBC Mauritius. The MIoD will incorporate the work of CGI Mauritius in responding to the challenges posed by climate change as an integral part of its advocacy pillar. The chapter will organise various activities, forums, training sessions and networking events to enable directors to enhance their skills in climate governance.