RI ESG Briefing, Dec. 17: non-financial reporting proposal approved at European Parliament

The round-up of environmental, social and governance news

Environmental

Danish commercial pensions provider PFA has provided a DKK240m (€32.2m) loan to Irish energy firm Bord Gais Eireann so the latter can buy turbines for a 24MW wind park in central Ireland, to be supplied by Danish wind power firm Vestas. The loan is guaranteed by Denmark’s Export Credit Agency (EKF). In a joint statement, EKF and PFA said that in this way, the pension scheme was not incurring any risk.

French insurance giant AXA has become the 53rd international company to sign the ‘Statement of Commitment by the Private Sector for Disaster Prevention, Resilience and Risk Reduction,’ a United Nations initiative. Signatories pledge to develop public-private partnerships for disaster risk reduction and support the development and strengthening of laws and regulations aimed at minimising disaster risk.

The Nordic Investment Bank (NIB) and Russia’s Vnesheconombank (VEB) have teamed up to provide a €50m loan facility for energy efficiency projects in northwestern Russia. The loan programme will run for ten years, and the banks said it was designed help Russian companies improve their energy efficiency and lessen their reliance on fossil fuels for power.

China’s National Development and Reform Commission (NDRC), a government agency that manages the country’s economic development, has encouraged the issuance of ‘catastrophe bonds’ amid climate change, China Daily reported, citing an NDRC strategy paper.

Social

Credit Suisse, the Swiss bank, is in “direct contravention” of its own commitments to human rights by taking a large stake in Vietnamese rubber firm Hoan Ang Gia Lai (HAGL), according to campaign group Global Witness. HAGL has been accused by Global Witness in relation to land grabs and human rights abuses in Cambodia and Laos. Global Witness is calling on the company to review its investment due diligence; Credit Suisse declined to comment to Reuters.

Stiftung Abendrot, the CHF1.17bn (€953m) Swiss sustainable pension fund, is investing CHF45m (€36m) to develop a building that will house both a senior centre and a college for building engineers. Abendrot, which has 23% of its assets allocated to real estate, said the project in the Swiss city of Winterthur would be completed in 2017.h6. Governance

The European Parliament’s Legal Affairs Committee has approved a draft law on corporate non-financial reporting today (December 17). And large companies would have to disclose information on their environmental, social and employee-related impact. In addition, large listed companies would also have to publish information on their diversity policy for boards, including information on the age, gender, disability, ethnic origin and educational and professional background of their members.

The Canadian government has launched a 90-day public consultation to help identify ways in which the Canada Business Corporations Act (CBCA) can combat bribery and corruption, increase board diversity and enhance the ability of authorities to access information on corporate beneficial ownership. The move was welcomed by the Canadian Coalition for Good Governance. The consultation will run until March 11 2014. Announcement

The US Securities and Exchange Commission’s recent decision to remove disclosure of corporate political activities from its agenda is a “policy mistake” according to Harvard Law and Economics Professor John Coates. He said it perpetuates a “key loophole” in the investor-relevant disclosure rules, allowing large companies to omit material information about the politically inflected risks they run with other people’s money. It was also a political mistake, Coates added, as it repudiates the 600,000+ investors who have written to the SEC on the issue.

The $167.5bn (€122bn) Florida State Board of Administration (SBA), has structured its latest annual corporate governance report to conform to the International Corporate Governance Network’s (ICGN) Statement of Principles for Institutional Investor Responsibilities, published earlier this year. The SBA said: “These principles establish current best practices in terms of the responsibilities of institutional investors with regard to their external role as investors in companies and other assets.”

Computer giant IBM has hit back at a lawsuit brought against it by the Louisiana Sheriffs’ Pension and Relief Fund. The fund, represented by class action law firm Bernstein, Litowitz, Berger & Grossmann, is alleging IBM has concealed how its links with the US National Securities Agency (NSA) has hit its China business. IBM General Counsel Robert Weber said the suit was “pushing a wild conspiracy theory”.