Maitland/AMO Sustain Monitor – 25 September 2020

25th September 2020

In this week’s In the Hot Seat we featured Peter Uhlenbruch, Head of Investor Standards at responsible investment charity, ShareAction.

 

In a recent report, Point of No Returns – Biodiversity, ShareAction stated that “asset managers currently fail to grasp the systemic threat posed by biodiversity loss.” So, we asked Peter to share his thoughts on how the industry can better manage the impact of biodiversity loss.

 

“To really move the needle, investors need to understand and take account for the real-world impact of investments on biodiversity. A financial risk lens can only take you part of the way. Thankfully there are some investor-oriented initiatives out there to help. Recently, we have seen the establishment of the Taskforce for Nature-related Financial Disclosure (TNFD), a parallel initiative to the TCFD that will help investors better understand their financial risk exposure.”

 

Peter added that “investors need to foster a systems-level awareness of the crisis, and really start thinking about the impact of their investment choices. Ideally, this awareness should filter through into purposeful company engagement, requiring companies to disclose their biodiversity-related risks and impacts, and setting fit for purpose targets.”

 

We then moved onto AGM activism during Covid-19. For Peter, this year revealed several key themes including childhood obesity and “insecure work, as COVID-19 has highlighted society’s dependence on low-paid workers.”

 

Despite most shareholder meetings moving online, ShareAction “still managed to hold companies to account on a range of ESG issues by asking up to 90 AGM questions either by email, video or live during virtual AGMs throughout 2020.”  Peter noted that when AGMs “went behind ‘closed doors’”, ShareAction took to Twitter “where our AGM activists recorded and shared their questions.”

 

And what can we expect for next year’s AGM season? “We’re also thinking about how AGMs could be run in the interests not only of shareholders, but stakeholders more widely. After all, we are seeing an unprecedented global shift towards stakeholder capitalism.”

 

The full interview can be read here.

 

Maitland/AMO Sustain Team


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

In Business

  • ELECTRIC COACH: The UK’s first 100% electric intercity coach service will be launching in October, taking passengers between Dundee and Edinburgh. Transport start-up Ember will be running the journey.
  • REGENERATIVE COMPANY: Walmart has pledged to reach net zero carbon emissions across its operations by 2040 without relying on carbon offsets as part of its goal to become a “regenerative company”.
  • AT&T CLIMATE TARGETS: AT&T has announced a new series of climate targets and has committed to becoming carbon neutral by 2035 through a six-point plan for lowering emissions including transitioning to a low-emissions fleet of hybrid vehicles.
  • BETTER TOGETHER: Microsoft and Shell have announced a strategic partnership that will see them collaborate on a host of green projects to help cut greenhouse gas emissions across their value chains.
  • MICROSOFT WATER PLEDGE: Microsoft has announced a ‘water positive’ 2030 target. As part of efforts to help tackle the shortages of freshwater anticipated in the coming decades, the company will aim to become a net replenisher of water.
  • EV LITTLE HELPS: Tesco has joined the Climate Group’s EV100 initiative to electrify its fleet of 5,500 vehicles. Tesco said: “We are delighted to become signatories of the EV100 campaign, which brings together both our commitment to transition to 100% electric vans, and our plan to install EV chargers for Tesco customers and colleagues all over the UK”.
  • VODAFONE CLEANS SUPPLY CHAIN: Vodafone has announced that it will evaluate its suppliers on the commitments to D&I and the environment when they tender for new work as part of the company’s aim to improve the lives of 1 billion people whilst cutting its environmental impact in half by 2025.
  • WASTE NOT, WANT NOT: General Mills has announced plans to cut greenhouse gas emissions by 30% in the next ten years across the entire life of its products, targeting net-zero emissions by 2050. It hopes to achieve this through a number of means including cutting food waste in half by the end of the decade.
  • ELECTRIC DREAMS: General Electric has announced it will no longer build new coal power plants in a move that may involve site closures and job losses. It will instead focus on renewable energy sources.
  • CARBON LEVY: Swiss Re has announced it will increase its internal carbon levy to $100 per tonne as of next year as part of efforts to transition its operations to net zero by 2030.

In Politics

  • CALL TO ARMS: Speaking at the UN General Assembly, UK Prime Minister Boris Johnson stated the world cannot be “caught napping” on climate change as it was with coronavirus, as he outlined plans for a green industrial recovery for the UK driven by technology.
  • CHINA CLIMATE ACTION: China’s President Xi Jinping has announced the country’s first long-term decarbonisation commitment with a pledge to ensure the country’s emissions peak before the end of the decade before achieving ‘climate neutrality’ by 2060.
  • NEW FROM NZ: New Zealand is planning to become the first country to introduce mandatory climate risk reporting from its major financial institutions. “Today is another step on the journey this Government is taking towards a low carbon future for Aotearoa New Zealand and a cleaner, safer planet for future generations,” said Minister for Climate Change, James Shaw.
  • PUMP THE BRAKES: The UK government is to pull forward its 2040 ban on new petrol and diesel vehicles by ten years. The new 2030 deadline would put the UK in line with Germany and Ireland.
  • GREEN GAS LEVY: The UK government has announced a ‘Green Gas Levy’ The Government is proposing a carbon tax to be levied on UK gas suppliers to fund the building of biomethane ‘green gas’ production plants able to decarbonise home heating.
  • CALI TO BAN GAS CARS: California Governor Gavin Newsom has signed an order that aims to halt the sale of new gasoline and diesel-fuelled cars by 2035, becoming the first state in the US to commit to such a goal.
  • JAPAN ESG: Japan’s powerful business lobby, Keidanren, has announced that it will promote ESG and sustainable finance in collaboration with the country’s Environment Ministry.

In Investment

  • BANK BETTER: NatWest has partnered with fintech app CoGo to launch a series of green initiatives designed to make it easier for its banking customers to measure and mitigate their carbon emissions. Customers will be able to access a carbon tracker that will offer tailored suggestions to help offset emissions. NatWest will also offer a one-off payment of £100 to customers who take out a personal loan to fund green home improvements.
  • MORGAN STANLEY ANNOUNCEMENT: Morgan Stanley has announced a target of ‘net zero financed emissions’ by 2050, becoming the first major US bank to do so. The move will see it radically reduce its lending and underwriting of debt and equity to carbon intensive sectors.
  • UNIVERSAL MEASURES: The World Economic Forum has released a set of universal ESG metrics and disclosures to measure stakeholder capitalism that businesses can report on, regardless of their region or industry.
  • O+: Eurazeo has launched O+, which aims to achieve zero net carbon by 2040 and play a role in bridging widening social gaps.
  • APPOINTMENT: Eurazeo has appointed Sophie Flak, Managing Partner, CSR and Digital, to its Executive Committee in a bid to prove Eurazeo’s commitment to sustainable and responsible investment.
  • NATIONAL GREEN BANKS: The UK’s Green Finance Institute has teamed up with US environmental groups the Natural Resources Defense Council (NRDC) and the Rocky Mountain Institute to develop a Green Bank Design Platform in order to help governments set up financial vehicles to support climate and environmental solutions.
  • SOMPO: Sompo, the Japanese insurance company, has said it will not insure or invest in the new construction of coal-fired power plants in Japan, except for projects for which underwriting, investment and financing has already been expressed.

In Research

  • OXFAM REPORT: New research from Oxfam has revealed that carbon emissions from the world’s richest 1% are over double the emissions from the entire poorest half of the global population. In Confronting Carbon Inequality, it details that the richest 10% (roughly 630m) account for over 50% of the world’s CO2 emissions.
  • PLASTIC PERIL: The Overseas Development Institute has reported that in order to achieve the world’s climate goals, current levels of plastic consumption need to be halved by 2050, with 75% of the remaining plastic being recycled.
  • COMMITMENT ON THE RISE: A new report from EnviroLab and the NewClimate Institute has shown a three-fold increase across the past year in the number of companies that have set net zero goals.
  • ALL TALK NO ACTION: EcoAct’s 10th annual study of the sustainability reporting performance of FTSE100 companies has revealed that only 16% had realistic decarbonisation strategies in place, despite close to half targeting net zero emissions.
  • BUTTING HEADS: New research from InfluenceMap has highlighted the issues caused by vested interests as 19 out of 20 industry lobby groups are actively opposing measures contained within the EU’s proposed Sustainable Finance Strategy.
  • CFA FINDINGS: According to a survey from the CFA Institute, only 40% of the investment industry incorporate climate change into investment decisions, despite 75% of global C-suite level executives believing that climate change is an important issue.