RI ESG Briefing, Nov. 21: Government response to Kay Review expected

The round-up of environmental, social and governance news


The Carbon Disclosure Project’s new Carbon Action report for 2012, compiled on behalf of 92 investors with assets of $10trn, found that companies reported reductions of 497m tones of CO2 as a result of emission reduction activities totalling $11bn in 2012. And the average return on investment for carbon reduction activities is 33%, equivalent to a payback period of three years.

Institutional investors in South Africa are failing to systematically factor in climate change and water risks when making investment decisions, according to a new report. Navigating Muddy Waters was released by WWF-South Africa, in collaboration with Carbon Tracker, Trucost, SinCo, the Government Employee Pension Fund (GEPF), and WWF-UK. Link

The so-called Marguerite Fund, the European Fund for Energy, Climate Change & Infrastructure, has expanded its wind farm portfolio with the acquisition of a 50% stake in the 80MW Chirnogeni project in Romania. Financing was raised from the European Bank for Reconstruction and Development, Erste Group Bank, ING Bank and UniCredit Bank Austria. The fund has also bought a 49.99% stake in two wind farm projects in Poland totalling 104MW. Link


A group comprising 39 companies, investors and non-governmental organisations (NGOs) have issued a statement regarding the recent challenge by the US National Association of Manufacturers, the US Chamber of Commerce, and the Business Roundtable calling for a judicial review of the Dodd-Frank rule on conflict minerals. Link

The Office of Fair Trading, the UK consumer watchdog, has launched investigations into so-called payday lenders. “We have uncovered evidence that some payday lenders are acting in ways that are so serious that we have already opened formal investigations against them,” the OFT said.h6. Governance

The UK government is set to release its response to the Kay Review into short-termism in the equity markets tomorrow (November 22), according to Jo Swinson, Minister for Employment Relations and Consumer Affairs whose remit covers corporate governance. Swinson was speaking at an event organised by Fair Pensions.

Dutch pension giant PGGM has selected MSCI ESG Research to provide environmental, social, and governance (ESG) research, ratings, and screening tools. The fund has subscribed to MSCI ESG Research’s full suite of products including MSCI ESG IVA for ESG ratings, MSCI ESG Impact Monitor for reputational risk assessments and MSCI ESG Business Involvement Screening Research.

New York State Comptroller Thomas DiNapoli says allegations by oil major Chevron that he has made ethical breaches are “baseless” and “without merit”. The company is accusing him of receiving campaign contributions relating to the controversial Ecuador environmental litigation, which has been the subject of investor scrutiny. “This effort is about protecting shareholder value and fulfilling my fiduciary responsibility to the New York State Common Retirement Fund,” DiNapoli said.

Major US pension funds the California Public Employees’ Retirement System (CalPERS) and the California State Teachers’ Retirement System (CalSTRS) are among a group of large investors who have sued pharmaceuticals firm Pfizer for securities fraud, according to reports. In so doing they are removing themselves from a long-running class action over allegations Pfizer misled them over the safety of the pain relievers Celebrex and Bextra.

Oracle, the US software titan, suffered a 58.9% vote against its executive pay policy at its recent annual meeting. It is estimated that 83% of independent shareholders cast their votes against the resolution, given that founder and CEO Larry Ellison has a 23% stake.