Maitland/AMO Sustain Monitor – 15 May 2020

15th May 2020

This week, oil and gas companies have come under fire from the Transition Pathway Initiative (‘TPI’), a global asset-owner led initiative which assesses companies’ preparedness for the transition to a low carbon economy. TPI’s latest briefing paper provides provisional Carbon Performance assessments for BP, Shell, Repsol, Total, OMV and Eni following the recent disclosure of new targets from all the companies except OMV.

The detailed report encourages investors to seize the opportunity to “establish a net zero standard for the oil and gas sector” and use collective action to drive change. Importantly, the report highlights some of the challenges of benchmarking within the sector as “no two oil and gas companies publish emissions, energy or target data using exactly the same boundaries (or scopes).” TPI also finds that claims of ‘net zero’ or 1.5°C alignment that have been made by these companies are not substantiated and calls for better disclosure. However, the good news is that companies are adopting a longer-term perspective and have increased their target ambitions. They are also starting to include Scope 3 greenhouse gas emissions, which can be difficult to calculate.

In response to the report’s findings, BP’s CEO Bernard Looney published an note on LinkedIn contesting TPI’s suggestion that BP’s approach to achieving its net zero targets are inconsistent with the Paris Agreement. Looney has promised an update in September, so let’s wait and see…

Have a great weekend.

Maitland/AMO Sustain Team


COVID-19 and companies:

The Response, Recovery, and Resilience – or R3 – Coalition will be managed by the Global Impact Investing Network (GIIN). It has been created in collaboration with the David and Lucile Packard Foundation, Ford Foundation, John D. and Catherine T. MacArthur Foundation, Open Society Foundations, The Rockefeller Foundation, and Sorenson Impact Foundation.

Speaking at a virtual event yesterday to mark the 10-year anniversary of Unilever’s sustainability strategy, Unilever’s chief executive Alan Jope has called on governments and businesses to “double down” on environmental commitments in the wake of the coronavirus pandemic in order to establish a more climate-friendly model of capitalism.

CDC has published guidance for businesses, schools, community centres and public services infrastructure to help them navigate reopening after lockdown.

L’Oréal has announced L’Oréal for the future, a €150m initiative that will help organizations support vulnerable women and environmental impact investing.

Starbucks is preparing to reopen about 150 of its UK stores from Thursday but only for drive-thru and takeaway orders, with a limited menu to order from. rival coffee chains including Pret a Manger and Costa Coffee have already started reopening stores for takeaways and drive-thru orders.

Impact investor BlueOrchard is working with bilateral donors, development finance institutions and foundations to develop a support initiative to provide funding for micro, small and medium-sized enterprises in emerging and frontier markets that have been affected by the Covid-19 pandemic.

FC4S has launched a working paper to support thinking on how to respond to the pandemic from a sustainable finance perspective. The paper will be updated and refined over time based on new information and new ideas.

Amundi and its employees want to provide collective support through a global financial solidarity action with the Red Cross, launched mid-April. The four-week fundraising campaign is organised in several European and Asian countries where Amundi operates. The Company will match employee donations up to 100% of the amount donated without limit, with a minimum donation commitment of 500,000 euros. The donations made will be fully used by the Red Cross as part of its response to the Covid19 crisis.

State-owned flag carrier Qatar Airways is offering 100,000 complimentary tickets on Qatar Airways flights to healthcare professionals in recognition of their hard work and dedication.

 

COVID-19 and climate change:

  • National Parks in the UK urge people to “stay local” despite lockdown easing

National Park authorities in England have asked people not to “rush back” despite the recent lockdown restrictions easing. The request comes amidst fears that the rural communities living inside these beauty spots could be overrun with an influx of visitors and the disease could be spread further via contamination from touching gates, as an example.

A report from Just Eat and the Sustainable Restaurant Association has revealed that takeaway restaurants are producing 25% more food waste in lockdown as they struggle to adapt to unpredictable ordering patters. The report details that the average cost of weekly food waste in the UK has increased to £148, compared to £111 pre-pandemic. However, the study also noted that UK households have reduced takeaway food waste by £3.2m weekly.

 

COVID-19 and communities:

O2 is partnering with environmental charity Hubbub to encourage people to donate old or unused smartphones to digitally disconnected members of the community, as part of a trial to tackle digital exclusion during the Covid-19 pandemic. The ‘Community Calling’ trial will initially involve 800 handsets being distributed to residents of Southwark in London.

American comedian Tina Fey hosted “Rise Up New York” – a celebrity virtual telethon that successful raised $115m for the Robin Hood association, a New York based charity helping tackle hunger and poverty.

 

A round-up of this week’s sustainability news…

In Business

  • LOTUS EV: Lotus is set to launch its first EV, a luxury hypercar that will cost over £2m. The car company has also partnered with Centrica to develop an innovative zero-emissions car that will full integrate mobility and energy storage.
  • MONTHLY BEST: The National Grid has confirmed that the UK has completed it’s first coal free month, going thirty days without any contributions from the country’s coal-powered stations.
  • BNP SPEEDS UP TARGET: BNP Paribas has announced that it has pulled forward the target date to 2030 for a complete coal exit to all OECS countries and has confirmed that it will not be onboarding any new customers who rely on coal for over 25% of their revenues.

In Politics

  • £2BN EXERCISE PROGRAM: The government has announced plans to fast track £250m of funding as part of a wider £2bn programme designed to deliver a “new era for cycling and walking” following the decrease in transport emissions since lockdown.
  • RENEWABLES BOOST: The Department for Business for Business Energy and Industrial Strategy has announced new changes to its plans to ensure the UK’s clean energy contract regime is able to handle the recent decrease in demand for power due to the pandemic. A number of leading wind energy developers have confirmed that they are moving forward with new projects.
  • EU GREEN CALL: The EU’s Climate Commissioner has called on national governments to lead the way in ensuring that all state bailouts have green conditions attached. This follows the European Commission’s recent decision to forgo mandatory climate requirements from an update to State Aid rules.
  • FINAL ROUND: Climate Assembly UK will meet online for their final weekend to confirm and finalise the recommendations that they will then present to the six commissioning parliamentary select committees.

In Investment

  • WIND DEAL: Iberdrola has signed an agreement for the acquisition of the French renewable energy company Aalto PowerExternal link, opens in new window., owned by Aiolos and Caisse des Dépôts et Consignations, for €100m. This company has 118 MW of onshore wind capacity already operational and a portfolio of projects totalling 636 MW in different phases of development.
  • BNP COAL OUT: Banking giant BNP Paribas announced a further strengthening of its coal divestment strategy, to all OECD countries its target to end the use of coal by its electricity-producing customers by the end of 2030. The Group will continue its commitment to put an end, in the near future, to relations with any customer developing new coal-based production capacity and will no longer accept any new customers with a coal related revenue share of more than 25%.
  • SUSTAINABLE DEPOSIT: Standard Chartered announced its corporate sustainable deposit product reached the $2 bn mark only a year after being launched, helped by a “significant” deposit from EDF. Launched in May 2019, the sustainable deposits help to finance activities that support the 17 UN Sustainable Development Goals.
  • ASSET MANAGERS ASSESSED ON HUMAN RIGHTS: ShareAction has published a report looking at how asset managers approach and assess human and labour rights. The report featured 75 of the most influential asset management companies worldwide across 17 countries.

In Research

  • GREEN HEATING: A €5.7m green domestic heating research conducted by the University of Exeter has been unveiled, aiming to pave the way for the adoption of domestic low carbon heating systems across England, France, Belgium and Netherlands.

 

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