RI round up: Feb 13

RI’s regular round-up of the most important responsible investment stories

An EU-backed consultation report and website has been launched as part of a project to explore the relationship between companies’ financial and non-financial performance and develop a European framework for improved company and investor dialogue. The Investor Value project, Led by Lloyds TSB and Telecom Italia with participation from the European Federation of Financial Analysts, CSR Europe and some of Europe’s leading business schools under the banner of the European Academy of Business in Society, seeks to demonstrate links between a wide range of environmental, social and governance factors and the financial performance of business. The project is one of a number of collaborative “laboratories” launched as part of the European Alliance for Corporate Social Responsibility. Günter Verheugen, Vice President of the European Commission, said: “I hope that the work of this laboratory can contribute to a quiet revolution in the way that enterprises who wish to can measure and communicate their non-financial performance, allowing investors and other stakeholders to use such information in their decision making processes. There is indeed no other powerful incentive to consider the strategic role of corporate responsibility than an investor able to value the role that it plays for the future prosperity and sustainability of a business.” The interim consultation report “Valuing non-financial performance” and feedback form are available online. The closing date is 28 February 2009. Link to site
Assets in UK ethical funds dropped by £4.4bn in the last quarter of 2008, down 7% on the previousquarter, and 25% down on the same quarter in 2007, according to figures from the UK Investment Management Association.
However, the IMA said actual sales of UK ethical reached £54.8m, higher than the inflow of £20.5m seen in the previous quarter. The same quarter the previous year saw an inflow of £99.7m. Total net retail sales for ethical funds for the whole of 2008 were of £152.4 million. In 2007 net retail sales were £472.8 million.
French SRI funds kept assets under management stable at €20bn during 2008, resisting the market downturn and increasing their share of overall market share from 1 to 1.4 per cent, according to Novethic, the French SRI research house. It said equity funds represented less than half (45%) of the SRI market, with money market funds rising to represent 30%.
New York’s pension funds have called for reports from three of the largest US pharmacy chains on their responses to increasing pressures to stop the sale of tobacco products.
William Thompson, New York City Comptroller, has submitted the shareholder proposals to CVS Caremark, Rite Aid and SUPERVALU on behalf of the New York City Employees’ Retirement System (NYCERS), Teachers’ Retirement System for the City of New York (TRS), New York City Police Pension Fund, New York City Fire Department Pension Fund and the New York City Board of Education Retirement System (BERS).
It challenges companies’ decision to continue sell tobacco products, despite the banning of such products by other pharmacies and drug stores and rising regulatory, competitive and public pressures to halt sales of tobacco products.

UKSIF, the sustainable investment and finance association, has launched the 2009 “Responsible Business: Sustainable Pension” survey. UKSIF’s second bi-annual survey is being sent to the pensions managers of all UK listed companies in the FTSE4Good and Carbon Disclosure Leadership indexes. The inaugural survey in 2007 found that nearly two thirds of funds gave “great” or “some” significance to alignment with their plan sponsor’s corporate social responsibility (CSR) and/or sustainability policy.
Henderson Global InvestorsSRI team has appointed Gwen Ruta, vice president, corporate partnerships at US charity Environmental Defense Fund (EDF) to its advisory committee. The independent panel provides guidance and accountability to the SRI team on research and engagement activities.
Ethos, the Swiss SRI foundation, has raised concerns about what it alleges are conflicts of interests on pay and remuneration at Swiss group Novartis ahead of its AGM on February 24. Ethos said it was “very surprised” that Novartis’ board had refused to disclose a supporting statement on a say-on-pay by Ethos and eight other institutions in the agenda of the AGM. Ethos said: “The board however presented a 25-line text explaining its opposition to the resolution. This unequal treatment poses a serious problem, in particular in light of the board’s evident conflicts of interest in this matter.” Ethos is requesting that the Novartis board prepare a remuneration report each year and put it to the advisory vote of the shareholders at the annual general meeting.The Carbon Disclosure Project (CDP) has issued its 2009 annual information request for climate change data to 3700 listed companies. CDP institutional investors (signatory investors) now represent a combined $55 trillion of assets under management. The CDP said the number of investors that signed the annual information request rose by almost a quarter to a record 475 this year, compared with 385 in 2008. In a survey of 80 CDP signatory investors, three-quarters said they factored climate change information into their investment decisions and asset allocations.
Domini Social Investments and the US Social Investment Forum have released a report, titled: ‘Innovations in Social and Environmental Disclosure Outside the United States’, which presents case studies of five countries, including Malaysia, where it said governments and stock exchanges have taken the lead over the US in social and environmental disclosure.
RCM, the specialist global equity manager within Allianz Global Investors, has hired Sue Chan as senior portfolio manager, global equities with responsibility for global sustainability portfolios, including RCM’s Global Sustainability fund. Chan, who joins from Blackrock, will report to Lucy MacDonald, CIO global equities and will be based in London.
SHARE, the Canadian shareholder activist group has published its annual proxy voting survey, which can be downloaded here: Link to site
Jon Williams, former head of group sustainable development at HSBC has joined
PricewaterhouseCoopers (PwC) as a partner with responsibility for ending and investments related to climate change, low carbon energy, water infrastructure, forestry and microfinance. He has been replaced at HSBC by Francis Sullivan, who formerly worked for WWF. Separately, PwC has bought Sustainable Finance, the sustainability and environmental risk advisor to financial institutions, for an undisclosed sum. Sustainable Finance co-founder Leo Johnson, brother to London mayor Boris Johnson, becomes a partner of PwC UK on the sustainability and climate change team. Matt Arnold, fellow co-founder of Sustainable Finance, has also become a partner at PwC and will lead the firm’s sustainability and climate change practice in the US.
The UK National Association of Pension Funds (NAPF) has given its support to proposals for electronic voting for all shareholders, which it said could act as an important spur to the reform of the voting system in the UK. In in its response to a UK consultation on the European Commission’s Shareholders’ Rights Directive, the NAPF said it also supported requirement (subject to certain conditions) for the asking and answering of questions at company meetings of traded companies.CalPERS has hired Anne Simpson, executive director of the International Corporate Governance Network as senior portfolio manager for corporate governance to replace Dennis Johnson, who left last June. Johnson left Calpers to become managing director of Shamrock Activist Value Fund. Simpson will oversee CalPERS’ focus list program, which involves monitoring portfolio companies’ performance related to finance, corporate governance practises and strategic issues. Simpson will also help Calpers respond to ongoing market reform issues before US policymakers and regulators.
50 US and overseas leaders in the fields of socially responsible investing, international relief, development, human rights, environmental stewardship and faith based investing are calling on the Obama administration to create an office for innovation in corporate social responsibility (CSR). Major signers of the letter included Oxfam America, Ceres, ICCR (Interfaith Center on Corporate Responsibility), Green America, and mutual fund companies PAX, Domini and Calvert Group. Non-US signers included the European Sustainable Investment Forum (Eurosif) and the Canadian Social Investment Organization.