RI ESG Briefing, April 17: UK plans development impact bond for Africa healthcare

The round-up of environmental, social and governance news


The World Bank has sold what its is calling a ‘Kangaroo Green Bond’, the first of its kind in Australia, after investors bought AUD300m (€202m) worth of five-year fixed rate paper backing investments to address the challenges of climate change. The World Bank has now issued a total of USD5.6bn in green bonds since its inaugural issue in 2008. The latest bond was placed with 15 investors, including Aberdeen Asset Management, AMP Capital, Australian Ethical Investment, Colonial First State Global Asset Management, Local Government Super, QBE Insurance Group and UniSuper. Link

NextEnergy Solar Fund Ltd., the new Guernsey-listed firm focused on UK solar photovoltaic assets, has raised £85.6m (€103.9m) in a share offering. It will list on the London Stock Exchange on April 25. It said it received “strong support” from institutional investors and private wealth managers.

France’s Ile de France region, in which Paris sits, said that socially responsible investors made up 85% of the buyers of a €600m municipal green bond issue, which was raised from an initial €350m target following significant demand. The region has a AA/AA+ rating from Standard & Poor’s and Fitch. The ‘Green & Sustainability Bond’ is its second after an initial €200m allocation. It said 76% of the buyers of the latest bond were French, 12% German and Austrian and 9% Dutch. The money will be spent on “eco-construction” buildings, sustainable public transport, renewable energy projects, and protection of water resources. ESG research firm, Vigeo, is carrying out the sustainability assessment of the projects.


The UK government says it will launch its first ever development impact bond to improve healthcare in Africa by bringing together private and public investment. International Development Secretary Justine Greening launched the new bond, to invest in the prevention of sleeping sickness in Uganda, at the Global Partnership for Effective Development Cooperation summit in Mexico. And the UK will also launch a new “roadmap” for increasing further private investment into frontier developing economies. Greening said: “Development bonds are a tremendous opportunity to quickly get the finance and investment needed to make development work.”

The French SIF (Le FIR) has awarded its first ESG Analysts Prize for a private company to Kering, the apparel company whose brands include Puma and Gucci, for its environmental accounting system launched by Puma. FIR said that 70 analysts from 37 different groups had voted in the award. It said the analyst consensus had been that Puma’s efforts “could be a first step towards the integration of CSR and financial reporting”. Separately, Belgian SRI manager Candriam (formerly Dexia Asset Management) has joined the FIR and will be represented by Isabelle Cabie, its Head of SRI.h6. Governance

CalPERS and the New York City Pension Funds have written to fellow shareholders in Duke Energy, urging a vote against four directors at the electric power holding company’s annual meeting on May 1. The quartet have “failed to fulfill their obligations of risk oversight” on Duke’s Regulatory Policy and Operations Committee. The call, which follows a serious coal ash spill in North Carolina recently, adds that none of the directors have relevant experience in hazardous waste disposal, environmental management and regulatory matters. “In fact, no director nominee has coal industry expertise,” adds the letter, which is signed by Anne Simpson, CalPERS’ Director of Global Governance, and New York City Comptroller Scott Stringer.

New York State Comptroller Thomas DiNapoli, the trustee of the New York State Common Retirement Fund, has announced an agreement with Comcast Corp. to disclose political spending made with corporate funds. It follows a shareholder resolution at the media and technology company where the fund has a $383m stake. DiNapoli said: “As one of Comcast’s largest shareholders, we applaud the company for agreeing to disclose corporate political spending.”

The International Forum of Independent Audit Regulators (IFIAR) has raised concerns over what it says is a “deficiency” in inspected audits of listed public interest entities, or public companies, relating to auditing fair value measurements, internal control testing, and procedures to assess the adequacy of financial statement presentation and disclosures. Referring to its latest survey Lewis Ferguson, IFIAR Chair and Board member of the U.S. Public Company Accounting Oversight Board, said: “The high rate and severity of inspection deficiencies in critical aspects of the audit, and at some of the world’s largest and systemically important financial institutions, is a wake-up call to firms and regulators alike: More must be done to improve the reliability of audit work performed globally on behalf of investors.”

Sally Bridgeland has left her role as CEO of BP Pension Trustees, according to Pensions & Investments. Bridgeland, an actuary and former investment consultant, joined BP in 2007 and is the founder of a charity called Executive Shift which works to create a change in senior staff working habits.

Aviva Investors, the UK fund firm with £241bn under management, has welcomed this week’s vote at the European Parliament supporting legislation to encourage companies to report on their environmental and social performance – calling it the start of a “brave new world” for corporate transparency. “This legislation should hugely increase the amount of information available to investors,” said Chief Responsible Investment Officer Steve Waygood.