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RI ESG Briefing, December 3: PensionDanmark invests €185m in UK wind farms

The round-up of environmental, social and governance news

Environmental

PensionDanmark is investing around £153m (€184.8m) in a 49% stake in six UK wind farms from Italy-based Falck Renewables. The investment in the farms, which have a combined capacity of 273MW and are located in Scotland and Wales, will be made via the Copenhagen Infrastructure I fund. It’s the latest investment by the DKK150bn (€20bn) fund into renewable infrastructure. Announcement

AMP Capital, the Sydney, Australia-based investment firm with US$125bn under management, is part of a consortium that has been granted a £317m transmission licence as part of the 504MW Greater Gabbard wind project off the UK coast. AMP has partnered with construction firm Balfour Beatty and infrastructure firm Equitix on the project; the deal marks AMP’s first offshore transmission investment. Greater Gabbard is also the first offshore transmission project to raise debt financing from public bond markets and the first UK project to make use of the European Investment Bank Project Bond Credit Enhancement.

The Climate Disclosure Standards Board (CDSB), the consortium of global business and environmental NGOs that’s managed as a project of CDP (formerly Carbon Disclosure Project), has launched new guidance aimed at UK listed companies disclosing their Greenhouse Gas emissions (GHG) to comply with recent amendments to the UK Companies Act. By showing the links between the new requirements of the Companies Act and a company’s existing voluntary CDP disclosure, the guidance helps practitioners avoid extra reporting burden and ensure consistency across communications.

Social

The Global Reporting Initiative and the Reporting and Assurance Frameworks Initiative (RAFI) have signed a memorandum of understanding to underline their “mutual commitment” to advancing meaningful corporate human rights reporting. RAFI is a project of Professor John Ruggie’s Shift and accounting firm Mazars, in liaison with the Human Rights Resource Centre, to develop public reporting and assurance frameworks based on the UN Guiding Principles.

Swiss private bank Notenstein, which has built a new sustainable investment team following the exodus of around 50 specialists from rival J. Safra Sarasin, aims to double the assets it runs for institutions as well as its profitability in the next years. Speaking to Swiss newspaper Le Temps, Notenstein chief executive Adrian Künzi said that in the long term, the bank aimed to manage CHF10bn (€8.1bn) in assets from institutions against CHF4bn currently. Notenstein looks after another CHF18bn for private clients – 70% of whom are in Switzerland.h6. Governance

First State Investments (known as Colonial First State Global Asset Management in Australia) is to adopt a set of Global Stewardship Principles across its business that will be compliant with the current disclosure requirements of the UK and other stewardship codes. The fund firm, owned by the Commonwealth Bank of Australia, said the principles were developed and endorsed by First State’s Global Responsible Investment Committee. It has £105.5bn under management.

Three UK investor bodies have reportedly called for an explicit reference to the notion of prudence in International Financial Reporting Standards. IPE was citing a letter from the Association of British Insurers, the Investment Management Association and the National Association of Pension Funds to the Financial Reporting Council. It follows the release of a legal opinion published earlier this year by the Local Authority Pension Fund Forum (LAPFF) and other major institutional investors showing substantial legal flaws with IFRS.

Institutional Shareholder Services (ISS) has launched a way for its investor clients to oversee the creation and application of their custom voting policies. PolicyEngine lets clients model their proxy voting policy and analyze how potential changes in a policy may have impacted past voting decisions and meeting outcomes.

Union Investment, the German asset manager that owns 1% of Daimler AG, has called on the auto giant to pull out of Formula One, saying its participation does not help it sell more cars and poses a reputational risk. “Daimler justifies its participation by highlighting the marketing bonus Formula One racing gives it in Asia and the Middle East,” financial daily Börsen-Zeitung quoted Union engagement head Ingo Speich as saying. “But this is not reflected in sales there.” Speich added that it wasn’t appropriate for a prestigious brand like Daimler to be associated with the scandal-plagued sport.

The Securities and Exchange Commission has dropped its plans to consider whether listed companies should disclose their political spending, according to a Washington Post report citing the SEC’s 2014 priority list. The Post said the item slipped off next year’s agenda “without any formal explanation”, adding the SEC declined to comment.

The Institute of Business Ethics has found that tax avoidance has replaced remuneration as the main public concern about business behaviour. The UK-based institute said the survey, by IPSOS Mori, also showed an improvement in the proportion that think business is behaving ethically since 2012, bringing it back in line with 2011 figures; meanwhile there has been a rise in the proportion saying businesses are behaving less ethically than in 2003.