RI ESG Briefing, August 4: Investor groups welcome Obama’s Clean Power Plan

Environmental

The US SIF: The Forum for Sustainable and Responsible Investment has applauded President Obama’s Clean Power Plan to reduce carbon emissions from existing power plants by 32% from 2005 levels by 2030. CEO Lisa Woll said it was “a crucial step in meeting America’s international commitment to reduce carbon emissions by as much as 28% below 2005 levels by 2025”. It would “help unleash investment in clean energy sources” and send a “powerful signal to investors”.

Shareholder advocacy group As You Sow said the plan could revolutionize the electric power sector by speeding the transition from coal to renewable power – a move that would make utilities a safer investment. Energy Program Manager Amelia Timbers said: “By discouraging coal, the plan lowers risk for utility investors, and improves the power sector’s long term prospects.” As You Sow has been pushing utilities to reduce coal use, adopt renewable energy, and improve climate performance for years. In 2015, over $10 billion in shares voted in favor of shareholder resolutions put forward by As You Sow and other co-investors.

The World Bank says that as of last June 30, it had issued 100 green bonds in 18 currencies, taking in a total of $8.4bn (€7.6bn) in proceeds. In its latest “Green Bond Impact Report,” the World Bank also says that as of the date, it had committed $5.6bn to environmental or climate-friendly projects, including $1.5bn that had gone to nine renewable installations with a combined power capacity of 2.28GW. Another $3.5bn has been spent on public transportation projects in 30 cities in emerging market countries. Link

Social

Business services firm KPMG has expanded its human rights advisory capability with the acquisition of Australia-based Banarra. Banarra currently services clients in 10 countries and is increasingly active in the resources, energy, finance, property and infrastructure sectors. Its notable projects include delivering security and human rights assessments for mining company MMG in the Democratic Republic of Congo and Laos and developing a Social Impact Framework for the Westpac banking group. Banarra’s founder and managing director Richard Boele joins KPMG as an Advisory Partner with KPMG Australia and brings with him a team of 10 specialist consultants.

UKSIF, the UK Sustainable Investment and Finance Association, has highlighted two government consultations that are currently open, on changes to Feed-in Tariff (FiT) accreditation and financial support for Solar PV. They run until August 19 and September 2 respectively and UKSIF says: “Submissions from investors will be particularly well-received and UKSIF will be responding in due course.”h6. Governance

Investment bank Goldman Sachs has reportedly tentatively agreed to pay some $270m to settle an investor lawsuit. Reuters, citing a “source familiar with the matter” said pension funds led by NECA–IBEW Health & Welfare Fund of Illinois had accused Goldman of misleading investors about the risks of mortgage securities offerings. The news agency said a Goldman Sachs spokesman declined to comment.

United States District Judge Alvin Hellerstein has approved a $400m settlement obtained by law firm Robbins Geller against pharmaceuticals giant Pfizer that was obtained ahead of the trial set for February this year. Pfizer agreed to settle certain off-label marketing investigations in the early 2000s, Robbins Geller said.

Bank of America has told shareholders it wants them to ratify the October 1, 2014 amendments to its bylaws that permit its board to appoint an independent Chairman, or appoint a Lead Independent Director when the Chairman is not an independent director. In 2009, shareholders voted to split the roles – though in 2004 the bank’s board overruled shareholders and gave CEO Brian Moynihan the added title of chairman. Filing

New Zealand’s Financial Markets Authority regulator says it has issued civil proceedings in the High Court seeking “pecuniary penalties” against former Milford Asset Management Portfolio Manager Mark Warminger for alleged “market manipulation” while at the firm over the December 2013-August 2014 period. Milford, whose mandate with the New Zealand Superannuation Fund has been suspended amid the scandal, is among a group of investors behind a new Corporate Governance Forum in the country.

The OECD’s Global Forum on Transparency and Exchange of Information for Tax Purposes has published new peer review reports today for 12 countries or jurisdictions – which it said means it is “moving further ahead with its goal to implement global standards on transparency and exchange of information for tax purposes”. Global Forum members will meet at their annual plenary meeting on 29-30 October in Bridgetown, Barbados.

Twenty-five investment firms with £1.8trn of assets have signed a statement of principles organised by the UK’s Investment Association trade body. The IA said they were “making a public commitment always to put clients’ interests first and ahead of their own”. All signatories will, by the end of the year, publish a statement, in plain English, on their websites explaining how they put the Statement of Principles at the heart of their organisations and how they identify and deal with any issues that could compromise their ability to uphold them. They will then report annually on their success in applying them. Announcement