The Institutional Investors Group on Climate Change (IIGCC), a group of 37 pension funds and asset managers with collective assets of over €3.5 trillion, has devised a set of reporting guidelines to assist electricity companies in their reporting on climate change risks and opportunities. The Disclosure Framework for Electricity Utilities is the result of collaboration between the IIGCC and sell-side analysts from CA Cheuvreux. The IIGCC said that under current disclosure requirements it is difficult for investors to “understand the manner in which the different companies have structured their business strategies and capital expenditure plans”. The work draws upon an earlier report by Insight Investment, The Climate Change Disclosures of European Utilities.
An initiative to boost the number of charities investing ethically in the UK – www.charitysri.org – has been launched by the EIRIS Foundation and the UK Social Investment Forum. The free online resource aims to address the disparity between those charities who express an interest in investing their money ethically and those actually doing it and provides clear, accessible and comprehensive information on why and how to invest ethically.
The six working groups of France’s “Grenelle de l’environnement”, the environmental action plan initiated by President Nicolas Sarkozy, have reported their findings back to the government. The six groups included association representatives, politicians, scientists, state bodies and trades unions. The findings have not been made public. A public consultation on the issue takes place during October. Sarkozy is then expected to announce a government environment programme for the duration of his presidency. Nathalie Kosciusko Morizet, secretary of state for ecology, said the goal of the Grenelle – named after a set of agreements made in 1968 – would be “to find the means for a generation to collectively take its responsibilities.”
Norges Bank Investment Management (NBIM), which runs the €223bn Norwegian Government Pension Scheme, has appointed Anne Kvam as head of corporate governance. Kvam joins NBIM on January 1 from her current post as legal director at Norske Skog, the Norwegian paper group. She succeeds Henrik Syse, head of corporate governance at NBIM since the post was created in 2005, who is leaving the bank at the end of the year. The bank is also expected to recruit three more staff members for the governance department, according to IPE.com. Separately, Knut Kjaer, chief executive at NBIM, has also announced that he is leaving the fund.
France’s AGF Asset management is to use the Country Sustainability Ratings of EIRIS, the London-based SRI research house to integrate environmental, social and governance issues into its fixed income products. AGF currently manages three Socially Responsible Investment equity funds and will use EIRIS’ research on sovereign bonds to convert one of its fixed income funds to SRI.
International Carbon Investors and Services (ICIS), a recently created group representing some of the world’s leading banks is petitioning the United States and other industrial nations to move to introduce a lightly regulated system for trading carbon emissions permits. “Where politicians opt to implement carbon constraints, then it should be cap-and-trade,” said Imtiaz Ahmad, head of emissions trading at Morgan Stanley in London and vice president of ICIS
ICIS members included Citigroup, Lehman Brothers, Morgan Stanley, BNP Paribas, Barclays Capital and Deutsche Bank Carbon traders say emissions permits could become the world’s largest commodities market if developed economies agree to take part in second-phase Kyoto negotiations, to be held in Bali, Indonesia, in December.
The European carbon market will continue to be over-supplied in emissions permits during 2008, damaging its the credibility, according to energy consultant Wood Mackenzie. The European emissions trading scheme (ETS) allows affected businesses to buy additional permits, or carbon offsets, from developing countries outside the scheme. “The problem is that this extra supply of offsets will easily exceed the shortage of carbon emissions permits within Europe, making it cheap for European firms to avoid cutting their own emissions at all,” said Wood Mackenzie.
The European Private Equity and Venture Capital Association (EVCA) is launching a code of ethics for its members. It is launching a public consultation for the code, which it said would be based on the International Organisation of Securities Commission model. The EVCA said the code would be based on six ethical principles, including integrity, fairness, respecting confidentiality and responsibility and be ready by January, 2008.
Separately, the UK government has said it is could intervene to stop private equity companies from claiming tax relief on profits from investments, following significant criticism of the practice. The results of a UK government commissioned consultation into the UK private equity industry, carried out by Sir David Walker, former chairman of Morgan Stanley, are expected in early November.
ING, the Dutch financial services group is to purchase clean, emission-free wind energy credits for its entire US operations. The group said it aimed to become carbon-neutral by the end of 2007.
VicSuper, one of Australia’s largest public superannuation funds, has released research profiling the carbon emissions of the top 200 listed companies in Australia, according to Australian on-line newsletter, Responsible Investment.
It said three quarters of companies in the ASX 200 do not disclose comparative quantitative emissions data. Almost half of all emissions were accounted for by just four companies, BHP Billiton, Rio Tinto, Bluescope Steel and Qantas.
HSBC has launched the Global Climate Change Benchmark Index. The index consists of 300 companies that it believes have the potential to profit from managing the challenges of climate change.
The $450m Louisiana State Police Retirement System is searching for one or more timber managers to run a total of $10m, reports US newspaper, Pensions & Investments. Irwin Felps, executive director of the fund said the new investment was being introduced for consistent investment returns and low correlation with equities and bonds. UBS Prime Asset Consulting is advising on the mandates search.
Institutional Shareholder Services (ISS), has dropped its name as part of a restructuring to combine all of its business units under the RiskMetrics group brand, following its acquisition of ISS in January. ISS will be known as RiskMetrics Group’s ISS Corporate Governance Services unit.
Philips, the Dutch electronics group, has announced that it is aiming for 30% of total revenues to come from green products by 2012, compared with 15% of group sales in 2006. The commitment is part of its EcoVision program that focuses on reducing the energy consumption of its products and facilities.
The group said it would double its investment in green innovations to €1 bn in the next five years.
F&C Investments has launched an ethical bond fund. The fund, structured, as a UCITS 3 open-ended investment company will start trading with £40m of existing assets. It is open to both institutional and retail investors. The fund will actively target credits from issuers which contribute to sustainable developmentand avoid exposure to issuers engaged in areas such as tobacco or alcohol production, gambling, pornography and the weapons industry, as well as those with poor practices towards the environment, human rights or labour relations.
KLD Research & Analytics, the US SRI research firm, has launched the Global SustainabilitySM Index (GSI) and Index series. The sector-neutral index consists of top environmental, social and governance performing companies across all sectors in North America, Europe and Asia Pacific.
The Rainforest Action Network (RAN) has said it will start a campaign against banks that invest in coal projects, reports Reuters. The group has identified Bank of America and Citigroup as banks that report low levels of emissions while continuing to invest in coal projects. RAN carried out a small protest against banks that invest in the coal industry outside a meeting of the Carbon Disclosure Project in New York last week.
At least six of HSBC’s biggest institutional shareholders are ready to publicly support the call by Knight Vinke, the activist investor, for the bank to overhaul its management and strategy in a bid to boost returns, according to UK newspaper, the Observer. Knight Vinke is demanding that the bank focus its energies on Asia and demote executive chairman Stephen Green to a non-executive position.