RI ESG Briefing, June 21: Three new social impact bonds in pipeline

Environmental

The Nordic Investment Bank has earmarked €1bn to continue loan allocation under its Climate Change, Energy Efficiency and Renewable Energy (CLEERE) lending facility. Since 2008, when the facility was launched, the NIB has committed €3bn to climate change projects.

Swiss private bank Sarasin says it remained carbon neutral again in 2011 after funding a wind park project in China. In the project, 66 turbines were set up in the province of Liaoning which together generate 97,486MW hours of electricity annually. The project qualifies as a Clean Development Mechanism (CDM) under the Kyoto protocol. As a result, Sarasin said it was able to offset the more than 4,000 tonnes of carbon dioxide it had emitted in 2011.

Social

The UK’s Big Lottery Fund will fund three new social impact bonds next year, according to a report in Civil Society citing the fund’s Director of Strategy Ceri Doyle. It quoted a spokesman for social investment developer Social Finance as saying the bonds will launch in autumn 2013 although no further details are available. Doyle also referred to “substantial” findings from the innovative Peterborough prison bond, the report added.

The New York Times has an in-depth look at the Peterborough prison bonds scheme and other social impact bonds written by Pulitzer Prize winner Tina Rosenberg. It’s called The Promise of Social Impact Bonds and is available via this link

Germany’s EthikBank (Ethical Bank) has expanded its investment horizon to include buying securities issued by the 50 members of the Global Challenges Index (GCX). The bank has made an initial investment of €1m in debt issued by Swedish paper producer Svenska Cellulosa. EthikBank’s investment portfolio is valued at €185m and is comprised mostly of sovereign and corporate bonds as well as Pfandbriefe (covered bonds). The GCX was created by Munich-based ESG consultant Oekom research and the Hanover stock exchange.h6. Governance

Carmignac Gestion, the France-based fund management firm with more than €48bn under management, has signed up to the United Nations-backed Principles for Responsible Investment. The 20-year-old firm said: “Carmignac Gestion has made a public commitment to adopt and apply the United Nations Principles for Responsible Investment (PRI).”

Investors in the US have become increasingly proactive in promoting their shareholder resolutions at company annual general meetings, according to an analysis of so-called “exempt solicitation” campaigns by finance website Shark Repellent. It found a record 45 campaigns this year – up 67% over 2011. CalPERS, the California Public Employees Retirement System, has filed the most – 37 since 2006, it added. Link

Shareholders at French retail giant Carrefour blocked an allocation of new share options to directors at its annual meeting in Paris this week, according to the Financial Times. And a resolution endorsing a €1.5m payment and estimated €500,000 annual pension to former CEO Lars Olofsson met with 48.1% opposition.

Pramerica Real Estate Investors, the $51.1bn (€40.3bn) property arm of NYSE-listed Prudential Financial, says it has adopted a socially responsible investment policy – and that it added $56.4m to the value of its global portfolios through sustainable initiatives. “Making a habit of incorporating sustainable practices, appropriate social policies and corporate governance into our decision-making process allows us to align our fiduciary responsibility with our goal of being good corporate citizens,” Pramerica CEO Allen Smith.

There’s been a four-fold increase in senior sustainability roles at companies listed on the FSTE 100 since 2005, according to recruitment firm Acre Resources. It said more than 20% of the FTSE100 firms now have a dedicated sustainability executive at main board level or one position below. Among the reasons for the growth are investors and shareholders “increasingly asking for sustainability credentials,” Acre said.