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RI ESG Briefing, May 8: Germany’s Union Investment in protest vote at Lufthansa

The round-up of environmental, social and governance news

Environmental

Members of the Interfaith Center on Corporate Responsibility, the Investor Environmental Health Network and other shareholders have released an open letter to the board of Danaher Corporation over the company’s failure to adequately address the environmental health risks of the use of mercury in its dental products. Referring to a shareholder resolution that the company omitted from its 2013 proxy statement, Cathy Rowan of Trinity Health and lead filer of the resolution said, “Danaher’s decision to exclude our resolution is difficult to comprehend in light of 2009’s strong shareholder support.”

Danish wind turbine maker Vestas A/S says it had firm orders amounting to 644MW in the first quarter of 2013 – with the value of the wind turbine backlog put at €7bn. There are also service agreements in place worth €5.4bn.

India: Clean technology entrepreneurs will benefit from international support under a program launched by the Global Environment Facility CEO Naoko Ishii and other officials. “The planet is arguably entering into the Anthropocene, a new ecological era in which human’s activities may go beyond the carrying capacity of the Earth’s ecosystems,” Ishii said. India Cleantech is funded by the GEF, administered by the United Nations Industrial Development Organization (UNIDO), and co-financed by the Government of India’s Ministry of Micro Small and Medium Enterprises (MSME).

Social

The new UK pension fund-backed infrastructure vehicle, Pensions Infrastructure Platform, is seeking expressions of interest (EOI) from investment managers to manage the PIP’s target £2bn (€2.4bn) assets. The EOI exercise will run from May 13-31. Earlier this year the PIP announced that its 10 founding investors, including British Airways, BAE Systems, BT and the London Pension Fund Authority, intended to each invest £100m.

The UK-based Ethical Property Company, whose shareholders include Rathbone Greenbank Investments and Aviva as well as a number of trusts and foundations, has raised £11m to fund its new project in Vauxhall, South London. Official opening of The Foundry’ is planned for Autumn 2013. Link

The second offer of the UK’s largest unlisted charity bond ever issued – by housing charity Golden Lane Housing in partnership with Triodos Bank – has been extended until June 28. Due to strong demand, especially by institutional investors, the First Offer was closed early. More than £8m of the £10m target has been raised to date. The bond has a minimum investment level of £84,000 and will receive a fixed yield of 4% per annum for the five-year fixed term.h6. Governance

German asset manager Union Investment and foreign shareholders were among those who followed a “no” recommendation from proxy firm Institutional Shareholder Services at airline group Lufthansa. The recommendation had initially prompted former CEO Wolfgang Mayrhuber to withdraw his chairmanship candidacy; he was voted in with just 63% support. Speaking at the AGM, Ingo Speich, who heads Union’s engagement and proxy voting operations, said Mayrhuber was not the right person to correct the mistakes made during his tenure as CEO.

A lawsuit lead by US pension funds the Ohio Public Employees Retirement System and the State Teachers Retirement System of Ohio against mortgage finance giant Fannie Mae and accounting firm KPMG has resulted in a $153m settlement. The funds had accused the companies of issuing false and misleading financial reports, Ohio Attorney General Mike DeWine said. “The settlement brings closure to this matter and recovery for our Ohio pension funds and class members,” DeWine added.

CalSTRS, the $163.7bn California State Teachers’ Retirement System, has hailed the 53% shareholder support for its proposal to split the Timken Company into separate steel and ball bearing businesses. “CalSTRS appreciates the confidence our fellow shareholders have placed in our analysis of the optimal corporate structure for the company, but as importantly, we expect the board to heed shareholders’ wishes and move expeditiously toward the split,” said CalSTRS’ Director of Corporate Governance Anne Sheehan.

It’s been confirmed that Kepler Capital Markets has acquired brokerage firm Crédit Agricole Cheuvreux, one of the leading sell-side SRI firms. The new firm will be called Kepler Cheuvreux and the news follows the announcement in July 2012 that the two were in “exclusive negotiations”. Crédit Agricole will retain 15% of the new entity, with UniCredit also taking a 5% stake. The other shareholders in Kepler will remain BlackFin Capital Partners, la Caisse des Dépôts, Gruppo Banca Leonardo and Crédit Mutuel Arkéa.
The UK’s Local Authority Pension Fund Forum recommended that its member funds reject the remuneration reports at defence group BAE Systems and insurer Aviva.

Governance for Owners’ role in the forthcoming AGM vote on J.P. Morgan CEO/Chairman Jamie Dimon has been highlighted in a New York Times article. The activist group has been tasked with voting the shares of the bank’s largest shareholder BlackRock, the Times added.