RI Briefing, February 2: Ireland starts green financial services centre

RI’s round-up of sustainable finance news.

The Irish government has launched its new Green IFSC (International Financial Services Center) initiative aiming to make the country a centre for green financial services. It includes the establishment of a government supported International Carbon Standard (ICS) and associated Dublin International Voluntary Offset Registry (DIVOR). The Irish government has agreed to provide seed funding of €6.8m over three years to develop the concept and it estimates that green financial services could create at least 7,000 jobs over the next five years.

A new study by research firm Sustainalytics has found links between sustainability performance and shareholder value in the mining, oil and gas and forestry products sectors. Sustainability and Materiality in the Natural Resources Sector looked at environmental and social practices in the sector and found a “correlation to competitiveness”.

The SEC has passed by a 3-2 vote rules that will enable shareholders to have a say-on-pay, ratifying proposals under the Dodd-Frank Act. Companies must now provide shareholders with an advisory vote on executive compensation at least every three years, with this year being the first applicable vote for larger US companies.

The Global Reporting Initiative has launched its new Focal Point USA platform to support US companies in their sustainability reporting.

Globalance Bank, the sustainability-based bank led by Reto Ringger, former founder and CEO of SAM, the Swiss fund manager, has received its banking license from the Swiss banking authority FINMA. The bank will focus on sustainable investments, distribute no proprietary products and says it will offer its clients total transparency on overall costs.

Storebrand, the Nordic pensions and insurance group, and PIMCO, the US investment firm, are jointly launching the PIMCO Emerging Markets SRI Bond fund. PIMCO will run the fund using SRI research from Storebrand.

TIAACREF is among plaintiffs in a lawsuit alleging “massive fraud” by US mortgage provider Countrywide, now part of Bank of America. According to the complaint, cited by Reuters, the investors bought hundreds of millions of dollars of Countrywide securities in the period before the sub-prime crisis which they thought were “conservative, low-risk investments”. Link

There’s been a 50% rise in companies using software to monitor their sustainability performance, according to the Global Reporting Initiative. “The next generation of the GRI Guidelines will address the issue of software and digital applications in sustainability reporting, with information and indicators that can be used electronically,” said GRI deputy CEO Nelmara Arbex. Website

The new US-based Church Investment Group is to form a private equity fund. “Forming a private equity fund to benefit the mission of the church is something many people have wanted to do for a very long time,” CIG founding chairman David Pitts was quoted as saying by the Episcopal News Service.Custody bank State Street has teamed up with F&C Investments to offer the latter’s environmental, social and governance (ESG) reporting service. The move enables State Street clients to “fulfil their UN Principles for Responsible Investment reporting needs”.

Standard & Poor’s and Hawkamah, the Dubai-based Institute for Corporate Governance, have launched their index for Middle East and North African (MENA) equity markets based on disclosure of Environmental, Social and Corporate Governance (ESG) issues.The S&P/Hawkamah Pan Arab ESG Index will include the top 50 MENA companies based on their performance on nearly 200 ESG metrics. The new index was partly funded by the International Finance Corporation (IFC).
Pax World, the US SRI manager has launched the Pax MSCI EAFE ESG Index ETF replicating an ESG-based benchmark of European, Australasian, and Asian companies.

The Network for Sustainable Financial Markets’ work on fiduciary duty featured in a United Nations Principles for Responsible Investment Academic Network webinar on January 19. It looks at “outdated” assumptions underlying interpretations of fiduciary duty. Link

Ceres and the Association of Chartered Certified Accountants have shortlisted 17 reports for their annual North American Sustainability Reporting Awards. The awards “acknowledge exemplary disclosure that places performance in the broader context of sustainability challenges”. The winners will be announced at the Ceres Annual Conference on May 11-12. Link

The New York-based Governance & Accountability Institute has published a new book called Strategic Governance. Co-written by Mark Sickles and Henry Boerner, it aims to help firms integrate financial, environmental, and social responsibility. More info

Banking giant BNY Mellon has announced a $1m, 10-year grant for the development of corporate social responsibility programmes and education at the University of Pittsburgh. They will be administered via the University’s David Berg Center for Ethics and Leadership. Link

Critical Studies on Corporate Responsibility, Governance and Sustainability is a new book edited by William Sun, Leader of Corporate Governance and Sustainability Research Group at Leeds Metropolitan University. It examines the “social, economic and environmental impacts of corporations” and is published by Emerald. Link

Clarification: RI faithfully reported information recently issued by the UN Global Compact that it had expelled Allianz France from its members. We have been notified by the Global Compact that Allianz AG, which joined the Global Compact in 2002, has centralized sustainability reporting at headquarters level, with all reporting intended to apply to subsidiaries, including Allianz Zagreb and Allianz France. The necessary request for withdrawal of these local subsidiaries was not communicated to the Global Compact Office, which is why Allianz France appeared on the list of expelled companies and Allianz Zagreb on the list of non-communicators. After consultation with Allianz AG, the Global Compact has removed Allianz Zagreb from its database and changed the reason for expulsion for Alliance France to better reflect the situation. Allianz AG – and, by extension, all its subsidiaries – are currently in good standing under the GC’s reporting policy. RI is happy to clarify this.