RI ESG Briefing, January 15: CDP publishes third Carbon Action report

Environmental

Environmental data NGO the CDP, the former Carbon Disclosure Project, has published its third annual Carbon Action report. It found an “exponential increase” in the number of investors asking companies to improve their climate performance. There are now 190 carbon action signatories, up from 92 in 2012. The report found that companies are allocating more capital to more projects: $33bn was invested in emission reduction activities with 1,050 reported projects last year.

US electric utility FirstEnergy has agreed to work at cutting its carbon emissions in response to pressure from shareholders including pension funds in New York State and Connecticut, according to a New York Times report citing New York Comptroller Thomas DiNapoli. As a result, DiNapoli, Connecticut and shareholder advocacy group As You Sow agreed to withdraw a shareholder resolution they filed for the company’s shareholder meeting, it added.

New European Union rules on public procurement that will put more emphasis on environmental and social considerations have come into force. The rules are part of a legislative package comprising three directives and one regulation. Two of the directives deal with “classic” and “utilities” public procurement. The regulation governs access for non-EU markets to the EU’s public procurement market and is still “under negotiation”. Link

Social

SOMO [the Centre for Research on Multinational Corporations], the Amsterdam-based sustainable development group, has launched an online tool that compares three corporate responsibility instruments and shows the most important overlaps or distinctions between them. The instruments compared are: the OECD Guidelines for Multinational Enterprises; ISO 26000; and the UN Global Compact. There’s also a downloadable version that offers a more extensive comparison of the three instruments.h6. Governance

The United Nations Global Compact, the corporate sustainability platform, has joined forces with UK real estate body the Royal Institution of Chartered Surveyors (RICS) to develop a best practice toolkit for the land, real estate and construction sector. The sector, which represents approximately 70% of global wealth, has substantial sustainability impacts, the pair said. The collaboration marks the Global Compact’s first initiative to address corporate sustainability in a specific sector following the recent launch of its Post-2015 Business Engagement Architecture.

UK insurer Aviva has reportedly strengthened its oversight of trading at its Aviva Investors asset management arm. Reuters cited company financial statements as revealing breaches of dealing policy between 2006 and 2012. Aviva Investors has set aside up to £92m to cover potential claims related to trading in gilts (UK government bonds), the report added.

Two more US companies – Xcel Energy and Endo Health Solutions – have cut their ties to the American Legislative Exchange Council (ALEC), the controversial lobbying body, according to reporting group the Center for Media and Democracy (CMD). Xcel is a utility holding company based in Minneapolis while Endo is a pharmaceutical company based in Pennsylvania. The moves mean 72 corporations have now cut their ties to ALEC, the CMD said.

Comprehensive rules to govern financial markets – including curbing high-frequency trading – were agreed informally by negotiators for the European Parliament and the Council of Ministers on January 15. The rules are designed to close “loopholes” in existing legislation and ensure that financial markets are “safer as well as more efficient, investors are better protected, speculative commodity trading is curbed and high-frequency trading is regulated”. The new rules will apply to investment firms, market operators and services providing post-trade transparency information in the EU.