Reporting Exchange Newsletter – the latest in ESG reporting
This month, we bring the latest on environmental, social and governance (ESG) reporting including new reporting tools and many developments in the investment community demanding better quality and relevant ESG data. Read on for more…
Aligning with the Paris Agreement: European Investment Bank to phase out fossil fuel financing
The board of the European Investment Bank (EIB) has agreed a new energy lending policy to phase out financing of unabated oil, gas and coal projects by 2021. By the end of 2020, all financing must be aligned with Paris Climate Agreement. The bank’s focus on low-carbon and renewable energy is expected to unlock EUR € 1 trillion of climate and environmental sustainable investment over the next ten years. Read more here.
Responsible Mineral Reporting Toolkit and GRI 207: Tax Standard launched
The Responsible Minerals Initiative (RMI) and the Global Reporting Initiative (GRI), have launched a toolkit to advance reporting on responsible mineral sourcing. The toolkit focuses on the challenges and opportunities of reporting on mineral sourcing from conflict-affected and high-risk areas. Access the toolkit here.
A new GRI Standard, GRI 207: Tax 2019, is the first global reporting standard supporting disclosure of business and tax payments on a country-by-country basis.
Asset managers to SEC: third-party ESG ratings simplistic and backward-looking
At a meeting of the Securities and Exchange Commission’s (SEC’s) Investor Advisory Council, major asset managers told the SEC that third-party ESG ratings are not useful as they are backward-looking and simplistic. The lack of ratings standardization and reporting consistency was also highlighted as a barrier. The representatives of the asset managers went on to highlight that the SEC could take the lead in resolving the situation. Forbes covers the subject here.
Continuing on ratings, the MSCI ESG ratings will be publicly available “in recognition of growing momentum and interest from a diverse range of stakeholders in ESG investing”. Read more here.
Webinar tomorrow:
Auditing & transparency in the digital age 5:00-6:00 pm CET 10 December
Our next Reporting Exchange webinar will explore auditing and transparency in the digital age with award-winning Daniel Hicks, Lecturer at the Miami Business School and a Reporting Exchange moderator. Register here.
UK Financial Reporting Council releases updated Stewardship Code
The recently-released Stewardship Code, which will take effect from January 1 2020, will require UK pension funds to disclose whether they have taken ESG factors into account when investing. The biggest revision to the code since it was first released in 2012, it will also require pension schemes to disclose their voting records. The revised code follows a consultation which closed in March this year. View the updated code here.
Natixis begins to incorporate climate risk into credit decision-making
French investment bank Natixis SA has begun incorporating climate risk into its credit decision-making process. Deals will be color-coded on a scale from dark green to dark brown. Brown deals with a greater negative environmental impact will be required to be more profitable than deals rated ‘green’. The move could even see some deals scrapped in the “most extreme” cases. The new rating system will apply to every sector Natixis deals with, excep the financial sector. Read their Q&A here.