RI ESG Briefing, October 29: ShareAction launches Green Light campaign

Environmental

Campaign group ShareAction (formerly Fair Pensions) has launched a campaign demanding climate action from UK pension funds. The Green Light campaign is supported by the UNITE and UNISON unions and NGOs including WWF, Friends of the Earth, Greenpeace, Christian Aid and Oxfam. The campaign has launched with a report on climate-conscious investment, which argues that pension funds have the responsibility to protect the public and their pension savings from the risks associated with climate change. Link

The European Investment Bank (EIB) has declared that following the recent Intergovernmental Panel on Climate Change report that “arguments for and against are now redundant and a waste of energy”. The bank said: “The world must move towards a low carbon economy and the EIB, as the EU Bank, can play a vital role. We support climate action projects in Europe and further afield, striving to improve energy efficiency, the diversification of energy supplies and the reduction of greenhouse gas emissions through cutting our dependence on fossil fuels.”

German, Dutch and French development institutions DEG, FMO and PROPARCO have invested a total of $69m in finance sustainable forestry in Latin America. It’s in the form of a long-term loan to wood group Grupo Maderero Empresarial to support a new production facility for wood panels in Ecuador which is expected to add 800 jobs.

Social

The UK government has announced plans to issue the first Islamic bond outside the Muslim world. It’s hoped the £200m (€233m) Sukuk next year will help to turn the City financial district into the “unrivalled western centre for Islamic finance”. The move was unveiled at the ninth World Islamic Economic Forum in London. There are also plans for a new Islamic index at the London Stock Exchange.

The Rhode Island State Investment Commission has voted unanimously to start divesting any stakes it holds via private equity holdings in Wellspring Capital Partners IV of firearm distributor United Sporting Companies. It’s the latest divestment to follow the Connecticut school shootings last December.

ImpactAssets, the US-based nonprofit financial services firm, has released the latest version of its free online resource for impact investors and advisors. The IA 50, now in its third year, is a database of private debt and equity impact investment fund managers. Fund managers included in the new version manage a combined $10.8bn in assets within the impact investing market.h6. Governance

CalPERS, the giant California Public Employees Retirement System, has voted against the executive pay report at software company Oracle, according to advance voting data. The fund says there’s a “significant disconnect between pay and financial performance” at Oracle, in the latest sign of investor unease over compensation at the IT titan.

The European Coalition for Corporate Justice (ECCJ), which campaigns for corporate accountability, has warned that the European Commission’s plans to improve companies’ nonfinancial reporting could “go into limbo” ahead of European elections next year. The ECCJ says a group of European Union member states led by the UK and Germany are trying to weaken the proposal. A first vote at the European Parliament’s Legal Affairs Committee is expected on December 17 with the full parliamentary plenary vote due in February next year.

NEI Investments, the Canadian mutual funds group, has published its 2014 Focus List of companies it will engage with on environmental, social and governance issues. Key themes will include: Canada’s transition to a lower-carbon economy, the social challenges of extractives industries and a new focus on sustainability issues throughout the food supply chain such as commodities trading and access to nutrition. There will continue to be a push for “reasonable, equitable” executive compensation and enhanced attention on diversity of both identity and expertise on companies’ boards.

Staying in Canada, shareholder advocacy group Mouvement d’éducation et de défense des actionnaires (MÉDAC) has published the six proposals it plans to file at the AGMs of the country’s seven major banks (Royal Bank of Canada, Laurentian Bank, Bank of Montreal, TD Bank, Scotiabank, National Bank of Canada and CIBC) in 2014. The proposals cover: 1) Gradual elimination of stock options as a form of compensation; 2) Paying fair share of tax; 3) Tendering of audits; 4) Responding to shareholder dissatisfaction via “say on pay” votes; 5) Feedback following large withhold votes for directors; 6) Pension plans and transparency.

It’s been reported that Glass Lewis, the proxy advisory group, has advised voting against the re-election of lead independent director John Thompson at Microsoft. Thompson, who heads up the software firm’s search for a replacement for CEO Steve Ballmer, faces possible conflicts of interest, Reuters reported GL as saying in a note to clients. Former IBM executive Thompson joined the Microsoft board last year.