RI ESG Briefing, May 14: SRI firm NorthStar rebuts Google over ‘one vote per share’ proposal

The round-up of the latest ESG news

Environmental

Campaign groups BankTrack and Friends of the Earth France called on France’s BNP Paribas to pledge to end its support for the coal industry. The bank, which held its AGM this week, accounts for half of the total support provided by French banks to the coal industry between 2005 and April 2014, the pair said. They also took out an ad in French daily Le Monde to highlight the issue.

The London School of Hygiene and Tropical Medicine has reportedly announced it has sold off investments in coal companies from its £16m endowment – making it only the second health organisation in the UK and third in the world to have made a divestment decision regarding fossil fuels. A spokesperson told the Guardian that its investment committee has recently decided to disinvest from coal, adding: “We are continuing to review our other energy investments.”

London Mayor Boris Johnson has reportedly dismissed a non-binding motion by the London assembly calling on the London Pension Fund Authority (LPFA) to divest from fossil fuels. Johnson, a member of the new Conservative national government, was quoted rejecting the “sudden cliff edge” of divestment, although he added he has no power over the LPFA, the Guardian reported. Green Party assembly member Jenny Jones said Johnson’s “reckless indifference” would harm members in the long run, the report added.

Social

The seventh annual Joan Bavaria Award for Building Sustainability into the Capital Markets has been won by Geeta Aiyer, the founder and president of Boston Common Asset Management. The announcement was made at the Ceres conference in San Francisco. Aiyer, elected recently to the Advisory Council for the Principles for Responsible Investment, was also a founder of fellow SRI firm Walden AM. The award – presented by Ceres and Trillium Asset Management each year – is named after SRI pioneer Joan Bavaria, who founded Ceres and Trillium.

The OECD, the Organisation for Economic Cooperation and Development, has called on technology companies to stop “extremely aggressive” tax planning, according to a BBC report. It quoted Pascal Saint-Amans, who runs the OECD’s Centre for Tax Policy, as saying new standards would require companies to pay more tax in the countries where they sold goods or created revenues. And it said he revealed that there should be international agreement on new tax laws ready for the G20 summit in November.h6. Governance

NorthStar Asset Management, the Boston-based SRI firm with $250m under management, has issued a rebuttal to Google’s opposition to the ‘one vote per share’ resolution it has filed for the internet giant’s AGM on June 3. NorthStar fears that “insider control” at the company “will be used to insulate management from addressing shareholder issues”. The rebuttal, filed to the SEC and signed by NorthStar’s President and CEO Julie Goodridge, says Google’s “current class structure is NOT in the best long-term interest of our stockholders and the current corporate governance structure is NOT sound and effective”. Google is advising shareholders to vote against the resolution, saying its capital structure is in the “best interests” of the company and stockholders. NorthStar has a similar motion on the table at Facebook, which holds its AGM on June 11. Goodridge appeared on CNBC to discuss this recently and the video is available here.

Eaton Vance Management, an affiliate of the venerable New York-listed, Boston-based $303bn Eaton Vance US mutual funds group, has become a signatory to the Principles for Responsible Investment (PRI). Other recent new signatories include Hong Kong’s Mirae Asset Global Investments, Canada’s CAAT Pension Plan and Hartford Funds Management, the US mutual funds group whose assets are sub-advised by Wellington Management.

The Committee on Capital Markets Regulation, the US not-for-profit group, has released data on the total public financial penalties imposed on financial institutions in the country in the first quarter of this year. Penalties totalled more than $7.8bn, it found – headed by four institutions that faced penalties of more than $1bn: Deutsche Bank, Morgan Stanley, Standard & Poors and Commerzbank. “The data show that financial institutions in the US continue to face historically unprecedented public financial penalties,” it said.

A new non-profit organisation in the US called the Campaign for Accountability (CfA) has sued the Securities and Exchange Commission to force the regulator to adopt rules requiring companies to disclose their political contributions. The CfA said it filed the lawsuit in the U.S. District Court for the District of Columbia on behalf of Steve Silberstein, who filed a rule-making petition to the SEC last year. The new body’s executive director is Anne Weismann, formerly chief counsel of Citizens for Responsibility and Ethics in Washington (CREW). Link

Nigeria: A new index stressing good corporate governance has been launched. Index firm FTSE Group has announced the FTSE Nigeria Investable Pension Fund (IPF) Benchmark. It said the new yardstick is the first of its kind in the region, “encapsulating Nigerian listed companies while adhering to National Pension Commission (PenCom) regulation on investment, safeguarding good corporate governance for users”. It has been created in collaboration with Stanbic IBTC Pension Managers Ltd, Nigeria’s largest pension fund.