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RI ESG Briefing, February 2: VBDO to ring Euronext bell to celebrate 20th anniversary

The latest ESG developments

Environmental

Shareholder resolutions have been co-filed by investors responsible for more than $8trn at mining giants Anglo American, Glencore and Rio Tinto under the ‘Aiming for A’ banner calling on them to be more transparent over climate change risks and opportunities to their businesses. The move comes in the form of shareholder resolutions which have received unprecedented support, including from four of the world’s ten largest pension funds: ABP via APG and PFZW via PGGM, North American funds CalPERS and the Canada Pension Plan Investment Board. Link

German Landesbank HSH Nordbank plans to provide
up to €1.3bn of finance for the renewable energy sector this year, including €1bn in project finance and €300m in loans to corporates in the sector. In 2015, the state-owned bank provided €1.2bn of finance to the sector. This, in turn, led to the installation of 450MW worth of new renewable capacity that year. HSH Nordbank’s renewable loan portfolio is worth around €5bn. The money has gone to fund around 230 projects in Europe with a combined capacity of more than 5GW.

Consulting firm Mercom Capital Group has just released its 2015 Annual Wind Funding and M&A report, and has found that total corporate funding in the wind sector came in at $15.4bn in 2015 – compared to $11.8bn in 2014. The top venture capital-funded company in 2015 was ReNew Power Ventures, which raised $265m. Home page

Social

The University of Cambridge’s Judge Business School is running a study into the evolving view of the materiality of non-financial information. It seeks to examine the materiality of nonfinancial information about issuers’ business activities by surveying a large population of senior decision-makers at corporate issuers, asset management firms, and asset-owning institutions. 
There are two surveys, one for corporate issuers and one for asset managers.

A group of some 80 campaign groups have written
to US food group Yum! Brands, which operates Taco Bell, KFC and Pizza Hut, to express concerns about the overuse of antibiotics in livestock production. The groups want the company to make a “strong, definitive public commitment” on antibiotic stewardship in its meat and poultry supply chains. They said the firm’s recent decision to eliminate the use of antibiotics “critically important” to human medicine in your chicken supply by the end of 2016 is a positive step forward, but does not constitute a meaningful antibiotics use policy.

The editorial board of the New York Times has called for a financial transaction tax on US equity, bonds and derivatives trading. The paper said a transaction tax applying to an array of transactions – and divided between buyers and sellers -would be a progressive way to raise substantial government revenue without affecting markets.h6. Governance

The VBDO, the Dutch Association of Investors for Sustainable Development, will celebrate its 20th anniversary by participating in the Euronext Opening Bell ceremony in Amsterdam tomorrow (February 3). VBDO founder Piet Sprengers will be there, along with representatives from Unilever, PostNL, Heineken and Standard Life Investments. The VBDO will also celebrate its 20th anniversary with the ‘Investing with impact’ event on February 4 in Utrecht. Meanwhile, the VBDO has also issued an interactive guide and self-assessment tool on natural capital for financial institutions. Link

Ethos has been in “intense dialogue” on environmental and social responsibility topics such as corporate codes of conduct, the publication of sustainability reports, climate change strategy and sustainable supply chain management. The Swiss governance firm that is backed by a group of pension funds says companies have become conscious of the importance of these topics, but a number of them still publish too little or no information. The news comes in Ethos’ new 2015 Short Engagement Report. The Ethos Engagement Pool (EEP), launched in 2004 by Ethos and two Swiss pension funds, today consists of 125 institutional investors with CHF17bn of Swiss equities under management. The dialogue universe (120 largest listed Swiss companies in 2015) will be extended to the largest 140 in 2016.

Index firm MSCI will reportedly exclude from its indices any Hong Kong companies that have been warned by regulators over their high concentration of shareholders. It will mean that 18 Hong Kong stocks will potentially deleted from MSCI’s Global Investable Market Indexes, Reuters reported.

Two-person board committees at US companies have come under scrutiny by the Wall Street Journal. Citing corporate filings service MyLogIQ, it reported that there are 11 companies in the S&P 500 index where key board panels comprise just two people. “The committees that figure out the pay for top executives at Yahoo Inc. and Alphabet Inc., the parent of Google, have only two board members,” it said, adding it was also true for the committees that recommend new directors for Chipotle Mexican Grill and Netflix.

The Qatar Stock Exchange, which has 43 listed companies, has reportedly joined the United Nations Sustainable Stock Exchanges (SSE) initiative and signed the voluntary commitment to advancing sustainability performance, transparency, and governance practices in QSE market. According to media reports, the exchange has received a letter from the UN organisations responsible for the implementation of the SSE initiative, which aims to explore how exchanges can enhance corporate transparency – and ultimately performance – on ESG (environmental, social and corporate governance) issues.

Class action law firm of Kessler Topaz Meltzer & Check has announced an expanded investigation of Theranos, the Palo Alto-based blood-testing firm that has been hit by a series of reports about problems with its technology. On January 27 the Wall Street Journal reported that federal inspectors found ‘deficient practices’ at a Theranos lab that could ‘pose immediate jeopardy’ to patients.