Rio Tinto, Unilever frustrated with mainstream investors on ESG

Greenpeace says NGOs will increasingly target investors on environmental issues.

Executives from corporate giants Rio Tinto, Unilever and Veolia have expressed frustration that mainstream investors don’t care about their progress on environmental, social and governance (ESG) issues.
Rio Tinto chief executive Tom Albanese explained that the company holds regular corporate social responsibility seminars with investors, but said mainstream analysts still want to know just about the business and not its ESG initiatives. However, he said there was growing awareness about the company’s environmental and safety record following the BP oil spill, he told the Global Business of Biodiversity Symposium in London on July 13.
Unilever senior vice president Gavin Neath told delegates that the investment community is divided between socially responsible investors and the mainstream. Of the company’s environmental initiatives, such as its tea plantations in East Africa, Neath said: “Mainstream investors have very little interest and give us very little credit for what we do – and there’s very little sign that is going to change any time soon.”
“That’s quite a depressing statement for us to hear,” said UN Principles for Responsible InvestmentExecutive Director, James Gifford, referring to Neath’s remarks.
Veolia Environment’s director of sustainable development Genevieve Ferone pointed out that mainstream financial analysts are not keen on biodiversity but they want to know about carbon: “CO2 is a metric, it’s a currency,” she said.
At the same event, Andy Tait, senior advisor on biodiversity at Greenpeace, the environmental NGO, complained that the investment community “hasn’t grasped” issues such biodiversity and deforestation – unlike companies such as Nestlé, Kraft, Unilever and Mars. He said he expected NGO campaigns to target investors more.
The UNPRI’s Gifford told a session on institutional investors that investors need to be much more effective advocates on biodiversity and climate change.
In the same session, Sagarika Chatterjee, associate director of governance and sustainable investments at F&C, called on fellow investors to work out which companies are well positioned in terms of biodiversity and climate risk.