RI ESG Briefing, Feb 20: CalPERS exits assault weapons makers

Environmental

The Export-Import Bank of Korea, Korea Eximbank, is issuing a five-year AA3-rated green bond with a benchmark size of $500m+, according to the Climate Bonds Initiative industry group. Joint lead managers are SEB and Bank of America Merrill Lynch. “This will mark the first climate bond out of Korea, coming out at a solid size and rating,” says the Climate Bonds Initiative’s Sean Kidney in a blog post.

A group of four United Nations agencies, including the UN Environment Programme, have teamed up to support green economic growth in developing countries. The new Partnership for Action on Green Economy (PAGE), is a response to the UN climate conference in Rio de Janeiro last year. PAGE will work with 30 countries over the next seven years in building national green economy strategies to “generate new jobs and skills, promote clean technologies, and reduce environmental risks and poverty”.

A groundbreaking Global Atlas for Solar and Wind is now available and “represents the largest initiative ever undertaken to assess renewable energy potentials on a global scale”. Launched during the International Renewable Energy Agency’s (IRENA) January Assembly, the project was initiated by the Clean Energy Ministerial and is the result of a two-year collaborative effort with IRENA.

Social

Maplecroft, the global risk analysis provider, is releasing its new ESG+POLITICAL Atlas and Risk Calculator. The tool includes 59 ESG and political risk indices covering 197 countries and has been developed to enable investors and sustainability professionals to “bridge the gap” left by traditional ESG analysis. “By evaluating ESG and political risks, organisations can ensure their investments do not compromise human rights, propagate conflict, or lead to the loss of biodiversity,” states Maplecroft Associate Director Helen Hodge.

Breckinridge Capital Advisors, the Boston-based fixed income asset manager with more than $18bn under management, has been awarded B Corporation certification. This means it joins over 680 other businesses in 24 countries that meet higher standards of social and environmental performance, transparency and accountability.h6. Governance

The $255bn California Public Employees’ Retirement System (CalPERS) has directed its investment staff to divest its around $5m of investments in makers of assault weapons that are illegal for sale in California – the latest result of the Connecticut school shootings in December. “Eliminating these investments allows us to keep our duty to our members and, in some small part, do what we can to help stop the proliferation of weapons that can magnify and multiply horrific acts of mass violence,” said Rob Feckner, CalPERS’ president.

Index and ESG firm MSCI has put together a research paper analysing three “ESG-tilted” strategies. “Optimizing Environmental, Social, and Governance Factors in Portfolio Construction” was compiled by Zoltán Nagy, Doug Cogan and Dan Sinnreich and is available here.

European banks may have to reveal their taxes and profits on a country-by-country basis if new proposals get the go-ahead, according to the Financial Times. The FT said the European Parliament wants the stricter disclosure regime to accompany tougher limits on bankers’ bonuses. Link

Dutch pension fund Stichting Pensioenfonds ABP, together with three co-lead plaintiffs, has reached a settlement with drugs company Merck. Under the deal, Merck will pay $215m to resolve a five-year-old securities class action. The settlement is part of a $688m total settlement that Merck agreed to with plaintiffs in two class actions that were combined for trial.

US activist fund firm Relational Investors says its campaign with the California State Teachers Retirement System (CalSTRS) seeking the break-up of industrial group Timken has strong shareholder support. Founder Ralph Whitworth was quoted saying an “overwhelming majority” of Timken’s public shareholders want a separation of the company.

The Securities and Exchange Commission of Pakistan has approved the Corporate Social Responsibility Voluntary Guidelines 2013 for public companies, according to local media reports. It’s expected to be a significant step towards streamlining reporting requirements and corporate accountability. The guidelines have been approved following consultation with companies, exchanges, accounting bodies and other stakeholders.