RI ESG Briefing, February 18: Citi unveils $100bn, three-year green financing plan

Environmental

US banking giant Citi has announced a commitment to “lend, invest and facilitate” $100bn (€88bn) over 10 years to “finance activities that reduce the impacts of climate change and create environmental solutions” A previous $50bn goal set in 2007 was met three years early in 2013. “We applaud Citi’s leadership as the company continues to innovate and expand its efforts,” said Mindy Lubber, president of sustainability nonprofit group Ceres, which was involved in convening stakeholders and providing feedback. It follows ING announcing earlier this month that it financed €19.5bn of sustainable projects and companies in 2014.

Norges Bank Investment Management (NBIM), the manager of Norway’s NOK6.5trn (€753bn) Government Pension Fund Global (GPFG), has disclosed significant stakes in three US firms in the energy efficiency and renewables sectors. According to US stock exchange filings, NBIM now owns just above 6% in EnerNOC and Itron. EnerNOC provides smart grid software, while Itron is an IT firm specialising in the resourceful use of energy and water. NBIM owns 5% of Ameresco, a Massachusetts-based energy efficiency and renewables company. The investments follow NBIM’s recent announcement that it had divested 32 coal firms.

The Forest 500 is the latest programme from the Global Canopy programme, the tropical forest thinktank behind the Forest Footprint Disclosure Project and the Natural Capital Declaration initiatives. The new programme, for the first time, identifies, ranks, and tracks the governments, companies and financial institutions worldwide that together could virtually eradicate tropical deforestation. The Forest 500 ranking and analysis will be repeated annually until 2020.

Social

WHEB, the UK asset management firm specializing in sustainable investments, has chosen research house Sustainalytics to provide a variety of ESG research and data solutions. WHEB will incorporate Sustainalytics’ ESG research and data into its stock selection and portfolio management activities. WHEB Partner Seb Beloe said: “We are eager to work with the Sustainalytics’ team so we can make the most of their insights.” Terms of the deal weren’t disclosed.

The UN Global Compact and the Royal Institution of Chartered Surveyors (RICS), the real estate body, are developing a best practice toolkit for the land, construction and real estate sector. It’s part of a two-year project to clarify the relevance to the sector of the UNGC’s 10 principles. The pair will produce a practical supplement to the toolkit in which companies can showcase their work on implementing the principles. The Principles for Responsible Investment is inviting its signatories to submit a case study demonstrating best practice examples that will support the issues and action items identified in the toolkit. The deadline is 18 March.h6. Governance

A group of UK based institutional investors, asset managers and shareholder representatives has called into question the accuracy of accounts prepared under International Financial Reporting Standards (IFRS) and highlighted the shortcomings that an over-reliance on neutrality brings to the audit process at listed companies. They made they feelings known in a letter to the Financial Times on February 16, signed by representatives of LAPFF, RMPI Railpen, Sarasin and Partners, Threadneedle Investments, GO Investment Partners and the UK Shareholders Association. It calls on the European Commission to closely examine the ‘fault lines’ in the accounting system that remains unaddressed since the financial crisis.

The board of Irish oil and gas explorer Petroceltic has gotten a boost in its struggle with Worldview, with three influential proxy firms recommending that shareholders oppose the Swiss hedge fund’s attempt to bring in new leadership at the firm. According to press reports, ISS and Glass Lewis are advising against voting for Worldview resolutions aimed at ousting CEO Brian O’Cathain and two board members. PIRC, meanwhile, recommends that investors abstain on the CEO issue but oppose Worldview’s board candidates. Worldview, which has a 29% stake in Petroceltic, is reportedly unhappy with O’Cathain’s leadership. Link

US labour union pension fund advisory body CtW Investment Group has written to fast-food firm McDonald’s calling for it to shake up its board of directors. It comes just weeks after the company announced the departure of CEO Don Thompson. CtW Executive Director Dieter Waizenegger wrote: “Returning McDonald’s Corp to a path of long-term, profitable growth requires that Mr. Steven Easterbrook’s appointment as CEO is followed by a robust refreshment of the board’s membership and leadership.” CtW home page

The European Commission is to launch a “Tax Transparency Package” next month to combat tax avoidance and aggressive tax planning. In a statement, EC President Jean-Claude Juncker, ex-Prime Minister of Luxembourg, says he has made the fight against tax evasion and avoidance a top political priority of the current Commission. As part of the measures the EC will propose legislation to extend the automatic exchange of information on tax rulings between member states. Link

The industry body for the UK’s fossil fuel industry, Oil and Gas UK, has complained to Energy Secretary Ed Davey about his comments that their assets could be devalued by global action on climate. In a letter, obtained by The Guardian under the Freedom of Information Act, CEO Malcolm Webb says he was “perplexed” by the “conflicting and confusing messages” and said Davey was making investment in the North Sea less attractive. Davey made the comments at the UN’s climate change summit in Lima last year, where he also supported calls for asset managers and banks to disclose the size of their fossil fuel holdings to investors.