Sustainable Switch: 'Give us one set of rules,' plead companies
16/06/2022 14:00
Sharon Kimathi
Energy and ESG Editor, Reuters Digital
sharon.kimathi@thomsonreuters.com
Hello!
Companies and investors are complaining that there are far too
many different sustainability rules and they are pleading with
regulators to harmonize environmental, social and corporate
governance (ESG) standards. They'd like to see a single set of
mandatory disclosure rules. Their plea comes as the Basel
Committee on Banking Supervision and U.N.-backed campaigners
seek to boost the minimum standards for companies pledging to
cut greenhouse gas emissions.
The We Mean Business coalition of 7,000 global companies wants
regulators https://www.reuters.com/business/sustainable-business/overlapping-rules-curb-greenwashing-may-only-add-company-frustration-2022-06-16
to unify their definitions, terminology and concepts before
finalizing the rules later this year, and not in the months and
years ahead.
While investors and companies want a single set of mandatory
disclosures to aid comparison between firms and keep down
reporting costs, three draft sets of disclosure rules are
currently out for public consultation from the European Union,
the U.S. Securities and Exchange Commission, and a new
G20-backed International Sustainability Standards Board (ISSB).
https://www.reuters.com/business/sustainable-business/new-company-sustainability-standards-body-drafts-first-guidelines-2022-03-31
Mark Spiers, partner at regulatory consultants Bovill, said the
different speeds at which the three standards are being written
creates challenges for international companies. "There are so
many jurisdictional specific regimes and trying to satisfy all
of them will be a Herculean task," he said.
Meanwhile, the Basel Committee, made up of regulators from the
United States, Europe, Japan, China and elsewhere, https://www.reuters.com/business/sustainable-business/global-regulators-set-out-climate-checklist-banks-2022-06-15
published a detailed checklist for banks to assess how climate
change affects all aspects of their business, including pay and
capital, as economies set carbon reduction targets.
International banks like Goldman Sachs, Deutsche Bank and HSBC
will be expected to look at how risks from climate change affect
their business strategy, training of senior staff and board
members, internal controls, capital and pay over the short,
medium and longer term, the guidance showed. It represents the
Basel Committee's latest effort to review how its rulebook
covers climate change in a sector at the forefront of efforts to
transition to a net-zero economy.
While the Basel Committee's updated guidance targets the banking
industry, the 'Race to Zero' campaign https://www.reuters.com/business/sustainable-business/un-campaign-sets-out-tougher-standards-company-net-zero-plans-2022-06-14backed
by the U.N. to drive faster climate action, is toughening the
minimum standards for companies pledging to cut greenhouse gas
emissions, including a requirement for businesses, banks,
insurers and asset managers, to curb new fossil fuel projects.
Members would also, for the first time, be required to align
their lobbying and advocacy activities with net-zero by
"proactively supporting" climate policies at the sub-national
and national level "consistent with the Race to Zero criteria".
Talking Points
* Electric and hybrid models should make up 80% of Ferrari's
sales
by 2030 https://www.reuters.com/technology/ferrari-tells-investors-it-will-build-even-more-unique-electric-cars-2022-06-16,
the luxury carmaker told investors on Thursday, vowing to
produce "even more unique" cars as it makes the expensive shift
to zero-emission driving.
* Britain's Financial Conduct Authority (FCA) said on
Thursday it
was writing to more than 3,500 lenders https://www.reuters.com/markets/europe/britains-fca-urges-lenders-do-more-aid-borrowers-cost-living-crises-2022-06-16
to demand greater support for consumers struggling with soaring
costs of living, after uncovering "serious failings" at more
than 30 credit providers.
* As a historic drought grips southern California, one
district is
getting tough on water https://www.reuters.com/world/us/california-district-curbs-water-supply-over-users-drought-2022-06-15usage
violators by reducing their supply directly from the source so
that sprinklers and outdoor hoses no longer work.
* Volkswagen asked for more time to review reports alleging
human
rights violations https://www.reuters.com/business/autos-transportation/volkswagen-asks-more-time-brazil-human-rights-probe-2022-06-15tantamount
to "modern slavery" on a farm it owned in Brazil between
1974-1986, according to minutes of an administrative hearing on
the probe seen by Reuters on Wednesday.
* Column: Most people use some form of contract during their
working lives. https://www.reuters.com/business/sustainable-business/comment-why-climate-clauses-contracts-are-powerful-tool-reach-net-zero-2022-06-15
Common contracts include supply, procurement, employment,
finance and real estate agreements and so on. That means that
nearly everyone has an opportunity to wire their organization's
net-zero targets into their business operations.
In Conversation
Gerbrand Haverkamp, executive director, World Benchmarking
Alliance
"The UN Climate Change Conference in Bonn ends today, after
talks designed to lay the groundwork for COP27. The stark
reality is that nowhere near enough has been achieved since
COP26 – and the small window in which we can stop irreversible
climate damage is fast disappearing.
"Some of the world's companies hold more power than entire
countries, so closing the corporate accountability gap – to
ensure that all businesses walk the talk – is a vital part of
the answer. Without accountability, talk is cheap. Governments,
investors, civil society organizations and citizens alike must
reward businesses that take positive steps and pressure the
laggards to do more. Only then will businesses take the urgent
action we need.
"And while policymakers and corporations have different
agendas, they must pull together to combat unprecedented climate
challenges. This means doing the hard, often unseen and
unglamorous work of collaborating and compromising. While this
isn't a new idea, it has never been more critical. Businesses
won't survive if the people and places around them aren't
thriving, so every business must step up."
ESG Lens
Even if Europe can fill its gas storage, Europe faces a perilous
winter https://www.reuters.com/business/energy/europe-fills-up-gas-race-replace-russia-far-over-2022-06-14and
governments will need to keep rationing plans to hand as they
race to secure more liquefied natural gas (LNG) to keep pace
with a rapid shift away from reliance on Russian fuel.
For European households, meanwhile, there is little respite from
sky-high fuel prices that have strained budgets, driven down
disposable income and weighed on the economic outlook.
ESG Movers and Shakers
AXA Investment Managers, the investment arm for global insurance
firm Axa, has hired Charles Fianko as a portfolio manager, and
Monique Carter as a solutions strategist.
Fianka joins from Lloyds of London, where he was also a member
of the Climate Change Investment Committee and brings experience
in tailoring corporate strategy to deal with climate change
risks within investment holdings. Carter joins from global asset
manager Insight Investment, where she worked on the portfolio
solutions team, designing and tailoring sustainable and cashflow
driven investments (CDI).
Global advisory, broking, and solutions company WTW has hired
Nicki Tilney and George Nassaouati to its natural resources and
construction lines of business within the Asia corporate risk &
broking business.
Tilney will join WTW as head of construction, power & renewables
in Asia. This is a new role created to better align the key
needs within the construction, power and renewable energy
sectors. She joins WTW from British multinational professional
services firm Aon where she was the head of construction, power
and infrastructure in Asia. Nassaouati, who currently heads
WTW's natural resources in Asia, will be appointed as head of
energy Asia.
Global outsourced investment office, Partners Capital Investment
Group, has appointed Christoph Günther and Dr. Michael Viehs as
head of public equities and global head of sustainable
investing, respectively. Prior to joining the firm, Günther was
an executive director at Goldman Sachs Asset Management, in the
alternative investments and manager selection group. Viehs joins
Partners Capital from Federated Hermes Limited, where he was
head of ESG integration.
Quote of the Day
"There is still a lack of disclosure in the market across all
kinds of metrics. Even metrics as important as CO2 emissions
that are now enforced by the regulators to be reported by
companies. Only about 8000 or 9000 companies of all listed
companies are reporting that information. So, it's also
important not just to process all the information that we might
find, but also estimate and give the information that we don't
find in the market."
Rebeca Minguela, CEO and founder at U.S.-based sustainability
tech platform Clarity AI
Looking Ahead
* The UK pension schemes of Santander and BMW plan to
introduce
net zero strategies tomorrow, as a study showed several major
British pension schemes had no plans for progressing towards
net-zero climate targets.
* Gillian Triggs, Assistant Secretary-General and Assistant
High
Commissioner for Protection with UNHCR, speaks at a Reuters
Newsmaker tomorrow.
* The General Confederation of Labor (CGT) trade union has
called
for a strike of French energy sector workers on June 20, to
demand better pay and working conditions.
* Federal government offices, Federal Reserve System,
International Monetary Fund, stock and bond markets will close
to mark Juneteenth on June 20.
Franchise
Disrupted https://www.reuters.com/technology/disrupted
Australian scientists have come up with a model that will help
researchers quickly identify soft corals https://www.reuters.com/business/environment/australian-scientists-develop-model-spot-soft-corals-most-risk-bleaching-2022-06-16most
vulnerable to bleaching from marine heatwaves, helping
prioritize resources to preserve reefs.
Coral bleaching has struck many reefs around the world,
including Australia's Great Barrier Reef, which was hit by four
mass bleaching events in the past seven years.
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