The Sustainability Accounting Standards Board (SASB), the body which promotes sustainably reporting at US listed companies, is readying its second set of standards, this time for the financial sector, in a sign of increasing momentum at the not-for-profit initiative.
SASB, which recently appointed former Securities and Exchange Commissioner Chair Elisse Walter to its board, launched its first standards, for the health care industry in July last year.
The next step for SASB is the launch tomorrow (February 25) of standards covering the financial sector, which includes commercial banks, investment banking & brokerage, asset management/custody, consumer/mortgage finance, exchanges and insurance.
The working group for this sector – comprising dozens of industry figures – was initiated in February last year and issued its findings for public comment on November 15. Financials is the second of 11 industry sectors that SASB is tackling over the next year or so.
The integration of ESG factors is listed as issues for banking, asset management and insurance, and as an emerging issue for exchanges, according to SASB’s research. Active ownership and shareholder engagement are seen issues for the asset management sector.
The next set of standards to be released will be Technology & Communications on March 18. The agenda continues with Non-Renewable Resources (June 5), Transportation (September 4), Services (December 3), Resource Transformation (February 25, 2015), Consumption I and II (June 2/ August 25, 2015). Then comes Renewable Resources & Alternative Energy (November 24, 2015). The release date for Infrastructure standards has yet to be decided.SASB, which is accredited by the American National Standards Institute (ANSI), was boosted recently by the appointment not only of Walter but also of jack Ehnes, chief executive of the California State Teachers’ Retirement System (CalSTRS) and Peter Knight, one of the founding partners of sustainable boutique Generation Investment Management.
It lists the top five companies by revenue in each financials sub-sector (listed only to provide examples):
Commercial Banks: Wells Fargo, Bank of America, JP Morgan Chase, Citigroup, US Bancorp
Investment Banking & Brokerage: JP Morgan, Goldman Sachs, Citigroup, Bank of America, Morgan Stanley
Asset Management & Custody: Bank of America, Morgan Stanley, JP Morgan, Bank NY Mellon, Citigroup
Consumer Finance: American Express, GE, Visa, Ford, SLM Corp.
Mortgage Finance: Fannie Mae, Fidelity National, JP Morgan, GE, First American Financial
Exchanges: NYSE, NASDAQ, CME Group, Intercontinental, CBOE Holdings
Insurance: Metlife, American International, Prudential, Berkshire Hathaway, Allstate Corp
Look out for more from SASB’s Executive Director Jean Rogers on the Financials standards on Responsible Investor tomorrow.