RI ESG Briefing, May 16: PGGM demands resignation of German real estate fund chief

The round-up of environmental, social and governance news

Environmental

The Ethical Investment Advisory Group of the UK’s Church Investors is to commence a “major review” of its policy recommendations on climate change, according to the Church Commissioners’ 2012 Annual Report. The Commissioners, which manage £5.5bn (€6.5bn) of church assets in the UK, have reported a 9.7% return on investment for 2012.

US-based sustainable funds firm Pax World has issued a rebuttal to Internet giant Google’s opposition to its proposal on recycling lead batteries at its data centers. The motion is due to be voted on at Google’s annual meeting on June 6. “Currently, shareholders are missing key pieces of information about how Google disposes of lead batteries used in its data center operations,” Pax World says.

The Universities Superannuation Scheme (USS) and Borealis, the infrastructure arm of Canada’s C$61bn (€45bn) Ontario Municipal Employees Retirement System (OMERS), have had a preliminary £5bn offer for UK utility Severn Trent rejected. The company said the proposal “completely fails to recognise the existing and potential value of Severn Trent”.

Social

The International Council on Mining and Metals (ICMM) has released a new publication called the Responsible reporting of mineral assets. It describes the work of the Committee for Mineral Reserves International Reporting Standards (CRIRSCO), the volunteer-run international organization. The body has also published a series of reports on climate change, including a look at the impact of carbon pricing on the industry.

The Calvert Foundation says its lending operations earned enough revenue in 2012 to make it 90% self-sufficient. The foundation is a non-profit organization offering community investment notes; it was formed in 1988 and took on its current form in 1995, with a collaboration between funds firm Calvert Investments, Inc. and the Ford, MacArthur and Mott Foundations.h6. Governance

Dutch pension asset management giant PGGM is demanding the resignation of Eckart John von Freyend as supervisory board chair at €3.3bn Berlin-based real estate fund GSW Immobilien. PGGM will be submitting this as a shareholder proposal at the GSW shareholders’ meeting on June 18 at which shareholders will also be asked to support a motion of no confidence in GSW’s recently appointed CEO Bernd Kottmann.

PGGM also voted against the re-election of Morgan Stanley’s chairman and CEO James Gorman at the investment bank’s annual meeting this week. PGGM, which manages around €133bn, said: “The proposed candidate would serve as both chairman and CEO. The Chairman’s role on a board is to evaluate and review the performance of management; this role is obviously compromised when the Chairman is also the CEO.” PGGM also voted opposed ratifying executive pay, as did the AFSCME Employees Pension Plan CalPERS, CalSTRS and the Florida State Board of Administration.

US labour unions the American Federation of Labor & Congress of Industrial Organizations (AFLCIO) and the Utility Workers Union of America have written to shareholders in New York-listed FirstEnergy Corp. ahead of the energy group’s annual meeting on May 21. They want investors to vote against its advisory vote on compensation and withhold support for all five directors on its Compensation Committee. The unions say that leading proxy advisory firms Institutional Shareholder Services and Glass recommend a “no” vote too.

France-based asset manager Amundi says it had dialogue with 220 companies in 2012, which resulted in 70 presenting their governance changes and proposed resolutions ahead of general meetings. The €750bn-assets-under-management firm said it voted on a total of 23,000 resolutions, of which 3,500 were negative. Cédric Lavérie, Head of Corporate governance, said companies are paying “increasing heed to our observations”.