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RI ESG Briefing, August 8: Deutsche Börse becomes first exchange to join integrated reporting pilot

The round-up of the latest environmental, social and governance news

Environmental

Germany’s state-owned development bank KfW has backed a wind project in Quebec. Its KfW IPEX-Bank subsidiary has provided a total of C$67m (€48m) in loan financing over an 18-year term for developer Innergex’s Viger-Denonville project. The 24.6MW project, located in the municipalities of Saint-Paul-de-la-Croix and Saint-Épiphane, is expected to begin commercial operation in the fourth quarter of 2013. In June KfW IPEX-Bank arranged €145m of financing for two offshore wind farm installation ships for Norwegian shipping company Fred. Olsen Windcarrier.

South Africa’s more than R1.1trn (€83bn) Government Employees’ Pension Fund (GEPF) highlighted its renewables investments outside its home country at a recent infrastructure conference in Nairobi. GEPF Chairman Arthur Moloto pointed to its backing of the thermal generating Rabai Power project and Turkana Wind Power projects in Kenya, invested via GEPF’s independent power producer Aldwych. The Lake Turkana wind farm alone would provide 300MW of clean power energy to the Kenyan grid, GEPF added.

The world’s second-largest offshore wind farm – the 500MW Greater Gabbard project – has been opened off England’s east coast by UK Energy Minister Michael Fallon. The £1.3bn (€1.5bn), 140-turbine facility is a 50-50 joint venture between SSE Plc and RWE Innogy. Link

Social

Ecclesiastical Investment Management, the UK based fund firm, has published its latest Amity Insight: Investing in Education. Education is one of Ecclesiastical’s nine positive ethical screens, and the publication looks at education as a human right and from the perspective of access being one of the eight Millennium Development Goals. It includes case studies, considers how business is investing in education and why investing in girls’ education is both pressing and urgent.

India’s Cabinet is considering setting up a women’s bank, according to reports. The bank, proposed in this year’s Budget, would provide dedicated financial services to women in general and women self-help groups in particular, the Business Standard said. Governance

Germany’s exchange operator the Deutsche Börse Group has become the 100th participant in the International Integrated Reporting Council (IIRC) Pilot Programme Business Network, designed to drive the evolution of corporate reporting. The group lists approximately 765 companies with a combined market capitalization of €1.2trn. It is also the first stock exchange to join the IIRC Pilot Programme. IIRC Chief Executive Paul Druckman said the move “demonstrates not only its endorsement of integrated reporting but the speed at which it is gaining momentum in capital markets.”

The £1.3bn (€1.5bn) Church of England Pensions Board supported just 36% of UK remuneration reports in 2012, according to the body’s new annual report for the year. It voted in total on 25,452 resolutions at 1,856 company meetings globally. The CEPB runs various pension schemes for over 32,000 clergy and church worker members. Benefits for service before 1998 are provided by the £5.5bn Church Commissioners.

The US Department of Justice has opened a criminal probe into investment bank J.P.Morgan Chase’s sale of mortgage-backed securities. The bank said it was “responding to parallel investigations” – civil and criminal – into its sale of mortgage-backed securities (MBS) between 2005 and 2007. The development follows on the heels of a civil lawsuit launched by the US government against Bank of America, alleging it committed fraud by packing MBS with loans known to be “toxic waste”.

Business sustainability group AccountAbility has examined the importance of non-financial factors on corporate performance, disclosure, and valuation in a new report. Redefining Materiality II: Why It Matters, Who’s Involved and What it Means for Corporate Leaders and Boards was developed in response to the growing acceptance that non-financial materiality is a factor in corporate valuation. It’s part of a new series of publications on materiality. The group will host a webinar to discuss the report on September 5.

The French securities regulator, the Autorité des Marchés Financiers (AMF) has issued a guide to support fund management companies in reading its position on remuneration policies applicable to managers of alternative investment funds. Link