Spot the difference
Conor Kehoe was formally proposed as the next chair of the Principles for Responsible Investment (PRI) on Wednesday at the network’s annual signatory general meeting. If ratified by members on 1 December, he will join CEO David Atkin at the helm of the investor network.
Following the nomination in June, Sharon Hendricks, vice-chair of CalSTRS’ board and head of the chair search committee, said the recruitment process was “underpinned and run by a diverse group of PRI board members, with a mix of gender and ethnic representation”.
This, she said, was designed to “ensure that issues of diversity and inclusion remained at the forefront of the process”.
Given all that, it seems slightly surprising that the end result is that the largest network in sustainable investing – a field noted for its deep talent pool of experienced women – will likely be run by for the next few years by two white men.
It is even more so given that, according to a person familiar, when Atkin replaced outgoing CEO Fiona Reynolds in 2021, there was “an expectation” that the chair role would go to a woman.
We hear that Kehoe’s appointment has already raised a few eyebrows in the industry. If you have any thoughts you’d like to share, please contact us at firstname.lastname@example.org.
The week in RI
Our editorial team was first with some of the big stories again this week.
On Wednesday, we revealed that the European Commission is planning to ask for feedback on new potential categories for sustainable investment products as part of a wider consultation on how to SFDR – news that was confirmed the following day.
Earlier in the week, we broke the news that Nature Action 100 had finalised its list of target companies, and our reporter Fiona McNally had the scoop on the upcoming launch of a sustainable investment forum in Poland.
A key theme of the week was ESG data and ratings, and the firms that provide them.
On Thursday, Dominic Webb was first out with Morningstar’s confirmation of major layoffs at its Sustainalytics subsidiary, including an exclusive interview with Ron Bundy, president of Morningstar Indexes.
Meanwhile, more digging through the responses to the European Commission’s proposals for regulating the ESG ratings market showed providers pushing back on attempts to link fees to costs, and corporates taking issue with the use of controversy scores.
In the US, we reported on a Republican-led initiative to haul SBTi before a Congressional committee, and former SEC lawyer Kurt Gottschall warned of more hefty penalties for ESG violations by asset managers.
And finally, a robust response to our asset owner survey revealed – perhaps unsurprisingly – that most would like to see an end to the proliferation of ESG initiatives.
Quote of the week
“A significant and extraordinary level of intrusion into the determination of fees by the ESG rating providers”
MSCI takes a firm line on suggestions that ESG ratings providers should be required to disclose costs, in its response to a consultation on proposed EU rules
The world owes a huge debt to the manufacturers of lifts and automatic doors, if the avoided emission calculations of one firm are to be believed.
Lazard Asset Management recently unearthed a CDP disclosure by one industrial company which reported that over the lifetime of its products, close to 50 gigatons of CO2 – equivalent to the global emissions in 2021 – would be avoided.
Demonstrating more restraint than the anonymous “company A”, Lazard noted that manufacturing lifts and automatics doors is “not typically associated with climate solutions”.
It added that such disclosures suggest companies “may risk overstating positive impacts when reporting avoided emissions”.
Biodiversity and the Big Apple
New York here we come! Next week our reporter Gina Gambetta will be heading to the US for New York Climate Week. If you’re attending and would like to meet up with Gina, drop her a line here.
A highlight of the week will be the eagerly anticipated launch of the Taskforce on Nature-related Financial Disclosures’ final recommendations and guidance.
Scheduled to take place on Monday at the New York Stock Exchange, the event will mark the culmination of a two-year development period, which has included four beta releases and the analysis and incorporate of more than 3,000 pieces of feedback.
Look out next week for RI’s coverage of the launch, as well as or other news and views from the Big Apple’s big climate event.
RI USA 2023: New perspectives
New York is top of mind for us at RI at the moment, as we are also hard at work on our own upcoming US event.
The 15th edition of RI USA will take place Convene at One Liberty Plaza on 15-16 November – and, if we do say so ourselves, the agenda and speaker line-up are looking pretty good.
With the anti-ESG backlash still dominating investor discussions in the US, we felt it was particularly important to include perspectives from both sides of the debate.
We are therefore delighted that Dan Crowley of K＆L Gates, Tim Doyle of the Bipartisan Policy Center and R Street’s Eli Lehrer and Jerry Theodorou have agreed to join us in New York to discuss key topics including fiduciary duty, proxy voting and the challenges for investors of navigating a politically polarised landscape.
We are also very pleased to announce the latest addition to our speaker roster. This week, John Skjervem, CIO of Utah Retirement Systems, has signed up to do the keynote interview with our editor, Lucy Fitzgeorge-Parker on Day One.
With a career in investing spanning more than 30 years, including seven years as CIO of Oregon State Treasury, John is uniquely qualified to discuss the implications of ESG for asset owners. We look forward to meeting him in New York – and hope to see you there!
Today’s letter was prepared by the RI editorial team