RI ESG Briefing, June 13: Sweden’s AP2 unveils 2013 Women’s Index

Environmental

The California State Teachers’ Retirement System (CalSTRS) and the Oregon State Treasurer’s office are spearheading a group of 22 US investors – with combined assets of $240bn – in signing the company-backed ‘Climate Declaration’. It calls on US policymakers to “seize the American economic opportunity of addressing climate change”. “As the global economy moves toward a low-carbon future, governments that act aggressively to enact strong, long-term climate and energy policies will reap the biggest rewards,” said CalSTRS’ CEO Jack Ehnes.

The Jubitz Family Foundation, a Portland, Oregon-based family foundation has committed to removing all oil, gas, coal and consumable fuel stocks from its portfolio – inspired by campaigner Bill McKibben’s 350.org group. “For many years the Foundation has committed to a socially conscious investment strategy. Divesting in carbon was a further step in aligning our investments with our mission,” said foundation president Al Jubitz. Investment advisor CTC Consulting found it would not have a significant impact on investment risk and return.

The Asset Owners’ Disclosure Project, which campaigns for greater transparency on institutional investors’ climate risks, has welcomed the Worldwide Fund for Nature’s (WWF’s) announcement that it will campaign for investment funds to invest more in renewable energy and less in fossil fuels.

Social

French state investor the Fonds de réserve pour les retraites (FRR) is seeking an external advisor on extra-financial risks to its portfolio. The FRR is looking to award a three-year contract and the deadline for applications is June 26. Link

The innovative Peterborough prison bond scheme, which mentors prisoners, has reduced re-conviction rates, according to new government figures. The pilot scheme, run by Social Finance “has helped prisoners who would previously have had no support” the Ministry of Justice said. The re-conviction rate has fallen to 39.2% from a previous 41.6% (higher than the national average of 37.3%).h6. Governance

The 2013 edition of Swedish state fund Andra AP-fonden’s (AP2) Women’s Index reveals that the number of women on listed corporate boards in the country has declined since 2011 and account for only 22.3% of directors. But the number of women in executive management positions has risen to 17.2%. “It is troubling that the proportion of women on corporate boards has declined again this year, and in principle has reverted to the same level as noted for 2010. As shareholders, we must seriously – and to a still greater extent – address the issue of what we can do to reverse this trend,” said AP2 CEO Eva Halvarsson.

A proposal filed by a $300bn global investor coalition, including Sweden’s AP funds and others, and led by the UAW Retiree Medical Benefits Trust on pay clawbacks at Wal-Mart gained more than 32% support at the retailer’s annual general meeting on June 7. The proposal had been supported by proxy advisory firms ISS and Glass Lewis. The result shows that “Wal-Mart investors want their company to be more accountable to shareholders and other stakeholders,” said the trust’s Chief Corporate Governance Officer Meredith Miller.

Consulting firm Georgeson says investors have voted to reject the remuneration of the CEO and senior managers at 20 U.S. companies in non-binding say-on-pay votes at company AGMS. Georgeson says the results reflect the influence of proxy advisory firms Institutional Shareholder Services (ISS) and Glass Lewis.

European Internal Markets Commissioner Michel Barnier has welcomed the European Parliament’s vote on new Accounting and Transparency Directives. He said: “With the new rules on country by country reporting, we have created a framework where businesses and governments must disclose revenues from natural resources. This framework will also contribute to the fight against tax fraud and corruption.”

Hermes Equity Ownership Services and ESG research house Sustainalytics are being appointed as governance advisors at Unilever pension funds, according to Mark Walker, Chief Investment Officer at Unilever who oversees certain of the consumer goods giant’s funds. He was speaking at the RI Europe 2013 event.