RI ESG Briefing, May 29: State Street Global Advisors sets new policy on director tenure

Environmental

SunEdison, the US solar technology firm, has filed for a proposed initial public (IPO) of its indirectly owned TerraForm Power solar subsidiary. Terraform will own and operate contracted clean power generation assets acquired from SunEdison and unaffiliated third parties. Goldman Sachs, Barclays and Citi will be joint book-runners for the offering. TerraForm will operate as a “yield co”, which is a way for solar companies to bundle up existing solar power plants.

A group of environmental campaign groups have warned that executives of major fossil fuel companies could face personal liability for funding “climate denialism”. Greenpeace International, WWF and the Center for International Environmental Law have written to the executives of large insurance corporations as well as fossil fuel and other carbon major companies to seek clarity on who is liable if lawsuits are brought against them. The responses from the fossil fuel companies and insurers and will be published on the Greenpeace International website.

A Sharia-compliant green energy project has been unveiled in the UK, according to reports. Simply Sharia has launched a vehicle that will sell Renewable Obligation certificates and electricity to the grid alongside partners Gardner Asset Management and Shariyah Review Bureau, according to Solar Power Portal. The scheme is also reportedly considering a 2.4MW solar farm scheme that will be run by Gardner.

Social

Two of France’s regional banks, Crédit Agricole Centre-est and Crédit Agricole Franche-Comté are the first of their kind to invest in Finance et Solidarité, a social cohesion fund run by French fund manager, Amundi. The fund invests in young, growing companies that provide goods and services, especially to disadvantaged people. One of the fund’s flagship projects, “Life wide open”, brings together those stricken by illness, students and businesspeople in an intergenerational housing complex in Lyon. The fund invests up to 80% of assets in firms and finance providers that promote social cohesion.

ESG research house Sustainalytics has announced that its assessments are now available to the more than 320,000 subscribers of the Bloomberg Professional service. As a third-party provider, Sustainalytics will offer clients that subscribe to both platforms access to a subset of Sustainalytics’ ESG ratings and coverage.h6. Governance

State Street Global Advisors, the investment management arm of State Street Corporation and the world’s second largest asset manager with some $2.3trn under management, is evaluating board refreshment and director succession practices at its investee companies through a new director tenure policy. It wants to identify companies with a preponderance of long-tenured directors, which may indicate a lack of refreshment of skills and perspectives on the board. The new approach takes into account average market-level board tenure and the policy may also translate into a range of potential voting decisions. Link

The Unitarian Universalist Association’s proposal for an independent chairman at Chevron was supported by a range of investors at the oil giant’s annual meeting yesterday (May 28). They included Norges Bank Investment Management (NBIM), Christian Brothers Investment Services, California pension giants CalPERS and CalSTRS, the Florida State Board of Administration, F&C and PGGM, according to voting disclosures.

The UAW Retiree Medical Benefits Trust, which is co-filing a motion on the re-coupment of executive pay at Walmart with the Illinois State Board of Investment, has welcomed support for the resolution from proxy firms ISS and Glass Lewis. The proposal calls on the US retailer to disclose whether it has clawed back pay from executives whose actions have caused significant financial harm to the company and its owners. It goes to the vote at the company’s AGM on June 6.

Egan-Jones Proxy Services, an arm of the ratings agency of the same name, has bought fellow US advisory firm ProxyTell, according to industry site CorpGov.net. Terms of the deal weren’t disclosed; ProxyTell President Kevin McManus will take over the management of Egan-Jones Proxy Services.

London-listed mining group Kenmare Resources has became yet another company to have an investor revolt over executive pay. The Financial Times reported that a third of shareholders voted against approving revised bonuses for senior staff at the Dublin-based group.

Institutional Shareholder Services (ISS) has reportedly recommended that shareholders vote against directors who sit on retailer Target’s Audit and Corporate Responsibility Committees at its annual meeting on June 11. It follows the highly publicised massive data breach disclosed last December.