RI ESG Briefing, Feb. 19: US bank faces shareholder resolution on climate financing

Environmental

Private equity giant KKR is to buy three solar photovoltaic energy projects in Ontario, Canada from an affiliate of Starwood Energy Group for an undisclosed sum. The Sault Ste Marie facility is one of the largest PV facilities in North America and the second largest in Canada, KKR said. “When it comes to infrastructure, renewable energy is one of our top priorities; not only is the sector a critical part of energy supply diversity, but these investments can also provide investors with highly predictable long-term income streams,” said Raj Agrawal, KKR’s Head of North American Infrastructure.

The Institutional Investors Group on Climate Change (IIGCC), which represents European investors and asset managers with €7.5trn of assets, has welcomed a vote in the European Parliament to back an emergency “backloading” plan to save the EU’s carbon allowances market from collapse. “This positive action is the crucial first step towards a permanent fix for the emissions trading scheme,” said IIGCC Executive Director Stephanie Pfeifer. MEPs on the environment committee voted 38 in favour of the proposal, 25 against and two abstentions.

Sampension, which manages industry-wide pension schemes in Denmark with assets of around DKK150bn (€19bn), is looking to double its forestry investments in the next few years, according to a report in Citywire quoting investment chief Henrik Olejasz Larsen. He was quoted saying forestry helps spread risk in the portfolio.

Social

Penn State University in Pennsylvania has launched a Sustainability Institute “to bring together researchers, educators, students, staff and community members from multiple colleges, campuses and frames of reference”. Penn State says the Institute will dissolve the traditional boundaries of the classroom to partner operations with research, teaching with community engagement and all with each other. Link

Eurosif, the European Sustainable Investment Forum, and other national social investment forums have launched a new version of the European SRI Transparency Code. Tracing its roots to the European Transparency Guidelines unveiled in 2004, the European SRI Transparency Code (the Code), first launched in May 2008, primarily aims at increasing accountability and clarity of SRI practices for European investors. As of December 2012, more than 500 funds from over 50 signatories have adopted the Code.h6. Governance

The Securities and Exchange Commission, the US regulator, has given the go-ahead for a greenhouse gas disclosure resolution to be tabled at financial services firm PNC Financial’s forthcoming annual meeting later this year. The motion – which for the first time will allow investors to ask a bank about how its financing decisions enable climate change – was proposed by Boston Common Asset Management and co-filed with Domini Social Investments, Friends Fiduciary Corporation, Sisters of Mercy, and Walden Asset Management. It requests that PNC assess the greenhouse gas emissions unintentionally enabled through its lending portfolio as well as its exposure to climate change risk in its lending, investing, and financing activities. “As investors, we want to ensure that the PNC Board and top management understand climate change as an issue, and the implications it may have for their business,” said Boston Common, Client Portfolio Manager Meredith Benton.

Institutional investors working with US sustainability advocacy group Ceres have filed shareholder resolutions at 13 companies calling on them to use more renewable energy and improve energy efficiency. Among the lead filers are New York City Comptroller John Liu and the California State Teachers’ Retirement System (CalSTRS). The companies are: CF Industries, Citrix Systems, Dun & Bradstreet, Electronic Arts, Equity Residential, Fiserv, Kimco Realty Corporation, IBM, Public Storage, Rockwood Holdings, Roper Industries, SL Green Realty and Walter Energy. IBM and Public Storage have reached agreements under which shareholders will withdraw their filings as the companies will disclose more information.

Korea-based sustainability specialist SolAbility has released its latest review of corporate sustainability in the country. The 6th Annual ESG Review finds that virtually all large companies now publish dedicated sustainability reports, and that some have already moved on to integrated financial-sustainability reports. “However, reporting is now considered a minimum, and does not necessarily reflect the real sustainability.”

GES Investment Services, the Sweden-based governance firm, engaged with 196 companies in 2012. Topics included business conduct (90 companies), emerging markets (84), Burma (38) and Western Sahara (10). The process involved 1,015 individual contacts with companies including 94 face-to-face meetings and 81 conference calls.