RI ESG Briefing, August 25: Fossil Free UK, Climate Policy Initiative, Pension Protection Fund

Environmental

The disclosure of the fossil fuel holdings of every local authority pension fund in the UK has been postponed until 21st September. Campaign group Fossil Free UK had originally planned to release the data, gathered through Freedom of Information requests, on 1st September. Speaking to Responsible Investor, a spokeswoman for Fossil Free UK said the launch had been pushed back to give local campaigners time to prepare regional stories.

DEG, the investment arm of German development bank KfW, says it acted as the lead arranger for $59m (€50.8m) worth of bonds issued to finance two hydroelectric projects in Peru. DEG also was one of the investors in the two projects, buying half ($29.5m) of the bonds issued. Other bond investors were Dutch development bank FMO and the Development Bank of Austria (OeEB). To fully fund the $88.3m project, another $29.3m in equity was provided by Union Group and an affiliate of Spain’s Banco Santander.

The Climate Policy Initiative, the not-for-profit organization backed by financier George Soros, has published a report exploring the landscape of climate exposure and examines the strengths as well as some of the current limitations of ESG data, tools, and financial products. The Landscape of Climate Exposure for Investors unpicks the challenges and opportunities in this field and finds “inherent challenges” in that ESG data is often voluntarily disclosed through a patchwork of different organizations and actors. “It varies significantly in the quality, quantity, and rigor of disclosed information,” the report states.

Social

The Pension Protection Fund (PPF), the UK’s £22.6bn (€31bn) pensions lifeboat scheme, has awarded a £400m direct lending mandate to Pramerica Investment Management. It follows a tender 18 months ago and the loans will be part of the PPF’s hybrid asset class. Under the deal, Pramerica will offer UK corporates fixed-rate or inflation-linked loans with maturities in excess of five years. Direct lending has grown in recent years as pension funds step into a gap left by banks’ exiting the area.

Norges Bank Investment Management (NBIM), which manages Norway’s NOK7.2trn ($875bn) Government Pension Fund, has launched its 2016 Investment Talent Programme. It’s a two-year trainee programme where “high achievers have the possibility of pursuing a master in Finance at a top business school”. The deadline for applications is October 4. Link. Governance

Japan: activist investor Yoshiaki Murakami has reportedly failed to win approval for his plan to get board seats at Kuroda Electric. Bloomberg News reported the former trade ministry official’s proposal to appoint himself and three others as outside directors at the electronics trader was defeated with about 60% of shareholders voting against it. Advisory firm ISS had backed the plan, though rival Glass Lewis advised clients to vote against it, the report added.

Twenty-two of the 41 OECD anti-bribery convention countries have failed to investigate or prosecute any foreign bribery case during the last four years, according to campaign group Transparency International. It says it means they are violating their obligation to combat cross-border bribery. The findings come in the group’s 11th annual progress report on enforcement of the convention, which comes 16 years after the entry into force of the convention.

Fines and lawsuits stemming from the financial crisis have cost big banks $260bn, according to research from Morgan Stanley cited by the Financial Times. The FT said the analysis – covering the five largest banks in the US and the 20 biggest in Europe – reckons the there will be another $60bn of litigation costs in the next two years. Bank of America, Morgan Stanley, JPMorgan, Citi and Goldman Sachs have collectively paid out $137bn, the report added.

US-based corporate governance site the Corporate Counsel is holding a workshop on pay ratios today (August 25). All nine panels have been pre-recorded and those who have registered can access them now. The Course Materials include 22-pages of annotated model pay ratio disclosures and 128-pages of detailed analysis of executive pay disclosures made during the 2015 proxy season. Link

Women are underrepresented on the boards of Australian superannuation funds, according to official data cited by industry publication Super Review. It cited data from the Australian Prudential Regulation Authority (APRA) as revealing women make up just a quarter of fund trustees. The information has been disclosed under questioning from Tasmanian Liberal Senator David Bushby, the reported added.