RI ESG Briefing, August 21: BlackRock ups stake in wind turbine maker

The round-up of environmental, social and governance news


US-based asset management giant BlackRock has increased its holdings of Danish wind turbine maker Vestas Wind Systems A/S to just over 10.2m shares – giving it a stake of 5.04%. Company announcement

Aviva Investors and Germany’s SachsenFonds GmbH have acquired a 49MW Spanish wind farm from Element Power – a Portland-based developer backed by Hudson Clean Energy Partners – for an undisclosed sum. “In a challenging macro economic environment where yields remain low, especially on government bonds, institutional investors are looking for diversified sources of stable income,” said Aviva fund manager Ian Berry. Link

China: the city of Shanghai has launched a pilot carbon emission rights trading scheme, according to local media reports. Some 200 companies will take part, the city government said in a statement quoted by China Daily.


UK pension lifeboat fund, the £12bn (€15.2bn) Pension Protection Fund, has enlarged its panel of active bond managers with the appointment of 15 specialist firms. Five are reappointments: Mondrian Investment Partners; Goldman Sachs Asset Management; PIMCO; Rogge; and Wellington Management. There are 10 new appointments: Alliance Bernstein; BlueBay; BlueCrest; Colchester Global: Insight IM; Investec; Loomis Sayles; M&G; Morgan Stanley IM; and Stone Harbor Investment Partners.

Only nine of 149 companies in the oil and gas industry were given top rating by Oekom Research, the German ESG research firm, for meeting meet its minimum standards for sustainability management. A total of 26 companies managed to qualify for a detailed rating. The highest-ranked integrated oil and gas company was Austrian-based OMV, which achieved a score of B- on the rating scale ranging from A+ (highest score) to D-. It was followed by Total (France) and Hess Corp (US), both of which also scored B-.

China Labor Watch (CLW) has issued a critical investigative report focusing on a Chinese supplier of Samsung, HEG Electronics, whose working conditions, it alleged, fell short of those of supplier factories for rivals such as Apple. The report claimed incidences of underage workers, and said student workers, mostly under the age of 18, made up 60-80% of the workforce. It alleged that HEG signs labour contracts only with teachers, not the students themselves, who are sent by training schools for work internships. Other violations, it said, included labour contract issues and health and safety conditions. Samsung said it would investigate, although previous investigations had found no irregularities.h6. Governance

A new review of the Swedish AP funds has recommended abolishing the system’s current quantitative investment regulations to be replaced with a structure based on the “prudent person principle” – to improve performance, governance and flexibility, according to reports. The Langensjö review also suggested a new authority to oversee the funds’ combined SEK871bn (€97.5bn) of assets.

Despite 95% of corporate directors that are not majority elected (+50%) by shareholders continuing to serve in their posts, changing voting standards are starting to unseat “unelected” directors, according to a report titled: “The Election of Corporate Directors: What Happens When Shareowners Withhold a Majority of Votes from Director Nominees?”, conducted by GMI Ratings and commissioned by the Investor Responsibility Research Center Institute (IRRCi). The report examines the causes and effects of shareholder opposition to 175 director nominees between July 1, 2009 and June 30, 2012. A webinar on the report’s findings takes place on Wednesday, August 22, 2012 at 1:00 PM Eastern Time.

The Canadian Coalition for Good Governance has announced the recipients of the 2012 “Governance Gavel” awards, presented at the 14th Annual Corporate Governance Conference in Vancouver. Suncor won ‘Best Disclosure of Board Governance Practices’ while Canadian National Railway Company 
won for ‘Best Disclosure of Executive Compensation’.

Insurer American International Group (AIG) has rejected a request from New York City Comptroller John Liu, who oversees the city’s $122bn pension funds, to disclose information on staff diversity, according to a Bloomberg report citing an interview with Liu’s Executive Director for Corporate Governance Michael Garland.

US pension fund, the Indiana Electrical Workers Pension Trust Fund IBEW, has sued Wal-Mart to gain access to internal documents relating to the Mexican bribery allegations that rocked the US retail giant earlier this year. It follows a series of lawsuits prompted by a New York Times report in May.

The China Association of Public Companies, the governance body founded in February this year, has called on listed companies to publish corporate social responsibility reports. “Listed companies should not suck the blood from investors but take social responsibility more seriously,” association Vice Chairman Yang Hua was quoted saying by China Daily.