ESG and Sustainability Research

Poseidon Principles | Swedbank

Feb. 2024: Swedbank has recently committed to the Poseidon Principles, an international initiative designed to incorporate climate considerations into lending practices within the realm of ship finance. These principles provide a standardized methodology for banks to collect and report emissions data from their shipping portfolios. The overarching goal is to bolster and streamline efforts toward decarbonizing the shipping industry.
Swedbank's participation adds considerable weight to the Poseidon Principles, enlarging its membership to encompass over 30 leading banks worldwide. Together, these institutions now oversee roughly 80% of the global ship finance portfolio, signifying a substantial collective effort towards advancing sustainable practices within the shipping industry.

SASB: ESG Integration

Detailed research on integrating ESG holistically In Private Equity discussed in this useful paper connecting the alphabet soup of ESG frameworks, standards and principles.

EU Taxonomy:
PRI Conclusions and Case Studies

See the report with key findings through consulting PRI signatories. In addition to useful recommendations on how to apply the EU taxonomy, asset managers also provide case studies to highlight best practices and key concerns.

Sustainable Development Investing

Perspectives from US Investors through US SIF
A recent report from US SIF highlighted the case for investing in the SDGs as well as capital market developments in fixed income (green, SDG-linked) and equities.

ESG and Corporate Performance: Empirical Evidence

Recent studies from HBS and Northwestern on material ESG drivers for corporate performance https://www.ai-cio.com/news/increasing-body-evidence-bolsters-case-esg-investing/ . Prof. George Serafeim further advocates the following actions to drive corporate sustainability strategy:

Investors fight back on DOL’s ESG Guidelines

During the commentary period, stakeholders criticized the Department of Labor for not providing adequate justification behind the proposal that undermines the consideration of ESG factors and equates all ESG investing under ERISA plans with a sole social focus at the expense of returns… See article for more information.

Adopt ESG Strategy
Create Accountability Governance Structures
Identify Corporate Purpose and Culture
Drive Operational Changes
Commit to Disclosure Transparency
Engaging with Investors

Impact Investing vs Impact Washing

Buyer Beware: Avoiding false impact investments. See:
https://www.worth.com/how-to-keep-impact-investing-impactful/

July 29, 2020

Climate Change Scenarios

Recent study argues for a 90% level of probability that climate sensitivity, defined as human influence on climate, is between 2.3 and 4.7 degrees. This means there is a very low probability that global warming will be below 2 degrees. While the above 5 degrees scenario is possible, the probability has been lowered to 10%.

July 23, 2020

Carrots & Sticks

**C&S, a collaboration between GRI and the University of Stellenbosch Business School (USB) has published the** **5th edition. A notable key trend is** the adoption of the UN Sustainable Development Goals (SDGs) as a global reference for sustainability reporting. Accordingly, SDGs 12, 16 and 8 are the most common. Overall, alignment in sustainability reporting remains limited and a global standardized framework is essential.

Sustainalytics ESG Risk Ratings

ESG Risk Ratings for over 4,000 public companies are now publicly available on Sustainalytics.

**Proxy Season 2019: Key ESG Focus Areas**

Gaya Capital

Reflecting on last year’s proxy voting outcome, overall, one might argue that a majority of ESG proposals did not pass due to lack of a majority vote. However, we note that several proposals in Climate Change, Sustainability and Shareholder Rights (written consents and proxy access) received strong support.Ahead of the 2019 proxy voting season, Gaya Capital would like to highlight key focus areas as it relates to Environmental Social and Governance (ESG) topics. We anticipate the 5 following topics of interest:

Increasing ESG Oversight and Accountability: Updated Proxy Advisory guidelines.
Board Diversity: Increasing Women Directors on Board.
Proxy Exemptions: Improving Shareholder Rights
Sustainable Packaging: Ocean Plastic, Allied Waste
Climate Change: Increasing Pressure for Carbon Policy and GHG Disclosure

Hershey’s Sustainability extends Upstream of Supply Chain

February 1, 2019. As reported on Freightwaves, Hershey is launching an initiative on sustainable farming of cocoa from key suppliers from Cote d’Ivoire and Ghana.

Minimizing Plastic Packaging Footprint

Global consumer staples leaders collaborating for a recycling lifestyle option called LOOP.
*Source: CNN, January 24, 2019*

The Most Sustainable Companies

On January 22, 2019, at the World Economic Forum in Davos, Switzerland, Corporate Knights released their ranking of the Top 100 global leaders in Sustainability. The methodology incorporated metrics such as carbon and waste reduction, gender diversity at senior management or executive level and “green” or “clean” label revenues. Chr. Hansen, a global bioscience company that develops natural solutions for the food, health and agriculture industries, was awarded the top position. For the complete ranking, please see the following: 100 most sustainable companies for 2019.
*Source:* *Corporate Knights* *and* *Forbes, January 22, 2019*

Alliance to End Plastic Waste

**Alliance to End Plastic Waste** (**AEPW**), a non-profit organization with close to 30 members, has committed over US$1 billion to solve plastic waste in the environment.

The global partnership, chaired by Procter & Gamble’s CEO, David Taylor, aims to research, fund and commercialize solutions to minimize plastic waste. The Alliance is focused on driving progress in four key initiatives:

Infrastructure: collect and manage waste and encourage recycling;
Innovation: research and commercialize enabling technologies for recycling and recovering post consumption plastics
Education and Engagement: broad participation by both public and private sectors
Clean Up: contaminated areas with plastic waste, notably rivers, (10 rivers carry 90% land-based plastic waste to the ocean). Note: 80% of ocean plastic comes from land-based sources.

ESG Portfolio Performance Research by Amundi

January 14, 2019. Amundi, the leading ESG asset manager published a detailed research report with key findings on portfolio returns based on environmental, social and corporate governance (ESG) criteria. Please see the company’s research.
“To seize the benefits of ESG investing for the portfolio profile, passive investors need to accept additional, yet controlled, tracking error compared with capitalization-weighted benchmarks. Beyond accepting additional – yet controlled – tracking error, combining ESG with passive investment may imply the need to design ESG-based Strategic Asset Allocation.”
RONCALLI Thierry , Head of Quantitative Research
MORTIER Vincent , Deputy Group Chief Investment Officer

5 Trends Driving ESG Investing

January 07, 2019 Perspective by State Street Global Advisors

Transition from Exclusionary to Integrated ESG strategies

Shift to Multiple sources of ESG data
Growing demand to understand Portfolio ESG Performance
Climate Change Solutions: from Mitigation of Risk to Adaptation of Investment Thesis
Growing Adoption of ESG

Please see original article for details from State Street.