- Financial Services
Another crucial new year for sustainability
As we enter 2022, the world again faces another vital year for sustainability. At this traditional time of resolutions, it seems fitting to reinforce the delivery of the promises made at COP26 in Glasgow. Kevin Anthony, Associate Director of Thought Leadership Sales at iResearch Services, says, “The financial services sector needs to transition towards net zero emissions and increase diversity in the workforce. Firm action needs to be taken against greenwashing and stronger and clearer reporting standards introduced. We can expect to see more investor and shareholder action to be taken over sustainability and the move towards eco-friendly energy and transportation gaining pace.”
In the months ahead, there are many important meetings and reports scheduled, including COP27 in Egypt in November, so it’s no wonder that the United Nations says 2022 matters for climate action. There’s one thing you can rely on, though: iResearch Services will keep you informed of developments throughout the year.
GOVERNANCE AND POLICY
Stewardship reporting ‘encouraging, but improvement needed’ says FRC
Elements of reporting under the UK Stewardship Code are of high quality, says the UK watchdog, the Financial Reporting Council (FRC). However, improvement is needed in some areas. Disclosures in Governance, resourcing, and the integration of stewardship and ESG factors with investment are praised, but improvement is required in explaining how they manage stewardship-related conflicts of interest, how managers review and assure their stewardship activities, and how they monitor and hold to account service providers operating on their behalf. The findings are contained in the report, Effective Stewardship Reporting: Examples from 2021 and expectations for 2022.
G7 sets out infrastructure finance approach
The leaders of the G7 have issued a joint statement about how to modernise infrastructure finance and accelerate investment in developing countries. The statement sets out the G7’s approach to financing quality and sustainable infrastructure to ensure a strong recovery from the pandemic and rapid progress towards the Sustainable Development Goals. The proposals also aim to support international climate and environment commitments, including those recently made at COP26 in Glasgow.
It says, “Low- and middle-income countries need to expand infrastructure investment to address climate change and support their transition to net zero emissions, and for health and health security infrastructure; digital, transport and energy connectivity; education infrastructure; and advancing gender equity and the fight against inequality. To help overcome this global challenge, we will scale up our collective action to mobilise private sector capital and expertise, using every tool in our respective development and economic toolboxes, and strengthen our partnerships with developing countries.” The G7 wants to drive global prosperity, sustainable development, connectivity and the transition to net-zero by better leveraging our economies, capital markets, expertise, technology and innovation capabilities. Supporting sustainable, resilient and quality infrastructure in developing countries is a long-term agenda, it says.
Hitanshu Dhingra, Associate Vice President, Investment, at iResearch Services, says, “Statements are all very well, but promises to provide finance to help developing countries to be more sustainable need to be translated into action and tangible funding.”
Europe’s Sustainable Finance Disclosure delayed again
The European Commission has again delayed Level 2 of the Sustainable Finance Disclosure Regulation (SFDR). In a letter, the commission says that, due to the length and technical details, the standards cannot be adopted within the next three months. It has now been postponed until January 2023. SFDR implementation was initially postponed from 1 January 2022 to June 2022. The delay is said to be due to the length and technical detail of those 13 regulatory technical standards, the time of the submissions to the Commission, and to facilitate the smooth implementation of the delegated act by product manufacturers, financial advisers and supervisors.
UK government ‘must conduct green review’, say business leaders
British business leaders say the government should conduct a review to help speed-up environmental policies in the light of COP26. In a letter, they stress the need for a rapid implementation of a new net-zero stress test for all policies, including comprehensive measures to transition away from fossil fuels. The letter to Prime Minister Boris Johnson and Chancellor Rishi Sunak is on behalf of the Confederation of British Industry, the Trades Union Congress, the UK Corporate Leaders Group, WWF UK, Green Alliance and E3G.
“As you know, COP26 is just the start of this process,” it says. “It is important we continue to show global leadership in setting out how the UK intends to increase its own efforts through accelerated action and implementation of domestic emissions reduction measures. We believe the Government should therefore establish a new cross-government initiative to review how current policies could be implemented more quickly and what new policies could accelerate action. If the review is completed by spring 2022 decisions could be made in time for the UK to submit a new and strengthened Nationally Determined Contribution at COP27 in November 2022, as required by the Glasgow Climate Pact. There is a huge opportunity for the UK to seize in showing continuing leadership of the global effort to address the climate emergency. As the Glasgow Climate Pact demands, we must use the remainder of our Presidency to push for accelerated action and implementation, leading by example.”
Gurpreet Purewal, Vice President of Sales – Thought Leadership at iResearch Services, says, “UK business leaders echo comments in our COP26 reports, that COP26 is not the end of the matter and the real work follows. Any advantages gained in the Glasgow conference will be lost unless the agreements and promises are quickly followed up with firm deliverables and action.”
EU Taxonomy regulations become law
Parts of the EU Taxonomy Climate Delegated Act have become law from 1 January 2022 after being approved by EU members states. This is the EU’s labelling system for green investment. The EU taxonomy aims to provide companies, investors and policymakers with appropriate definitions for which economic activities can be considered environmentally sustainable. This part of the regulations relates to the sustainability criteria for renewable energy, car manufacturing, shipping, forestry and bioenergy and more. It includes a “technology-neutral” benchmark at 100 grams of CO2 per kilowatt-hour for any investments in energy production. EU commissioner for financial services, Mairead McGuiness, says, “I warmly welcome that European Council has cleared the EU Taxonomy Climate Delegated Act. This will help channel sustainable finance towards projects and businesses to help reach our climate targets.”
Call for mandatory accounting for impact to aid “just transition” to net zero
Mandatory accounting for impact by businesses and investors to harmonised standards are among recommendations by a task force to provide a “just and inclusive transition to net-zero”. Industry-led, independent Impact Taskforce also says the G7 should urgently make more institutional capital available, especially for emerging countries. It also calls on G7 shareholders to enable development banks and financial institutions to be more effective in supporting the mobilisation of private investment for a just transition to net-zero. Recommendations in its Time to deliver: mobilising private capital at scale for people and the planet report include:
- Mandatory accounting for impact by businesses and investors to harmonised standards, recognising the central role of transparency and integrity in changing behaviour and driving investment flows
- Support for the efforts of the International Financial Reporting Standards Foundation’s International Sustainability Standards Board (IFRS-ISSB) to create a global reporting baseline on impact related to enterprise value
- Increasing the supply of investment vehicles suitable for institutional investors, empowering multilateral development banks and development finance institutions to be more effective in catalysing mobilisation of private investment, with particular focus on emerging economies where the funding gap is greatest
- Ensuring that more capital meaningfully contributes towards a Just Transition, by putting forward three Just Transition Elements that provide a common foundation for action to deliver a transition to Net Zero that leaves no one behind.
The report focuses on how to accelerate the volume and effectiveness of private capital seeking to have a positive social and environmental impact. The Impact Taskforce’s recommendations establish the roadmap for unlocking finance to support these urgent funding requirements. It lays out actionable pathways so that institutional capital, estimated globally at $250 trillion, can work more effectively with public capital to deliver positive social and environmental benefits for people and the planet.
The report urges governments to create mandatory and harmonised disclosure standards for companies and investors. It endorses the IFRS-ISSB work on a globally harmonised baseline on impact related to enterprise value that can allow greater transparency, efficiency, and accountability, and encourages all G7 members to do the same.
The Impact Taskforce also recommends that larger businesses use their expertise to help guide small- and medium-sized enterprises to better disclosure in the longer term. It calls for public-private cooperation to advance emerging work on impact valuation that might allow meaningful comparison between the impacts and profits of companies, enhancing integrity in impact accounting and disclosure processes.
The report also calls for an enhanced role for multilateral development banks and development finance institutions. The Impact Taskforce asks G7 members to use their power as shareholders in those institutions to enable them to be more effective in supporting the mobilisation of private investment, and to amend their mandates to give equal weight to mobilising private capital alongside investing balance sheet capital, using a range of proven tools and instruments for investment.
Nick Hurd, a former UK Minister and the Chair of the Impact Taskforce (ITF) says, “Investment decisions are being taken today with incomplete information. We need to transform the quality and transparency of data on impact. Our report presents an actionable pathway towards a world in which investments decisions are looked at through the triple lens of risk, return, and measured impact.”
Sectors split over sustainability rankings
There is a gap between perception and reality about which financial services sector most embraces sustainability, a new iResearch Services survey shows. 7 out of 10 (70%) Investment Banking respondents believe that the sector most embraces sustainability, compared with just 41% of financial services professionals from other sectors. So says the Sustainability Snapshots:How Sustainable is Financial Services? survey. Similarly, 69% in the Corporate/Commercial Banking sector say their sector leads the way, while a mean of just 38% from all other sectors agree, according to the survey of 550 financial services professionals.
Yogesh Shah, CEO of iResearch Services, says that the contrasting perceptions of how well financial services firms are doing when it comes to sustainability shows how much work still needs to be done. “One of the ways to bridge these gaps is for firms to accelerate the standardization of sustainability standards, especially when it comes to measurement frameworks and benchmarking. Firms also need to have a pulse on whether their efforts are communicated in a way that manages expectations while also showcasing their achievements when it comes to sustainability.”
European Funds investors should use SDA-GEVA approach, says White Paper
Institutional investors – insurance companies, pension funds, sovereign funds, banks, asset managers – are increasingly looking to align their strategies with the Paris Agreement. They also want to assess and report on portfolio alignment. In the Investor Portfolio Alignment with the Paris Agreement White Paper, S&P Global Sustainable Trucost recommends using the SDA-GEVA approach (The Sectoral Decarbonization Approach and Gas Emissions per unit of Value Added.) The White Paper assesses individual corporate decarbonization rates against those required to achieve the goals of the Paris Agreement and combines them into a portfolio-level assessment of alignment. Trucost’s approach can be widely applied across sectors and asset classes, while Trucost’s Paris Alignment dataset shows that more than two-thirds of listed companies are misaligned with the Paris Agreement aim of limiting warming to 1.5–2°C. “With diversification pockets currently on the rise, portfolio-level assessments are increasingly less meaningful if they omit this pocket on grounds that data is non-existent or methodologies inconsistent,” says the White Paper. (Registration required.)
What are allocators doing about ESG?
Three out of four allocators fail to track ESG metrics on their private portfolios because there is no standardization of reporting requirements. So says a report from Backstop Solutions titled, What allocators are really doing about ESG in 2021. So, when it comes to ESG allocators what are the right metrics? The survey of 131 allocators found nearly half said they were not measuring ESG factors, due to the lack of any universal standards to measure and report. The survey concludes, “Don’t let worries about standards, frameworks, and ongoing monitoring prevent you from moving forward. It’s clear that now is the time to take even small steps toward ESG reporting and monitoring.” Note, registration is required to download the report.
Sustainable transition roadmap for Swiss financial sector
The Swiss financial sector has a key role to play in moving towards a more sustainable and climate-neutral world, says Swiss Sustainable Finance. It is launching an ambitious roadmap, The Transition to a Sustainable Future with recommended industry actions. It includes concrete measures targeted at various financial market players such as banks, asset managers, insurance companies and institutional investors. “With this Roadmap for the Swiss financial sector, Swiss Sustainable Finance lays out a plan for the different market players involved and illustrates what their role should be in the transition to a sustainable future. We do not claim to know the right solution to all challenges. Hence, we see this plan as a starting point, and think it should be subject to ongoing discussion with key stakeholders in the Swiss financial centre.”
BBVA Bank joins UN Principles for Responsible Banking
Spanish-bank BBVA has joined the UN global commitment to promote inclusion and financial help. BBVA is one of 28 banks around the world that has joined the global commitment to promote financial inclusion and the financial health of its customers. Under the umbrella of the United Nations Principles for Responsible Banking, the aim of this benchmark index is for a group of banks to join forces and pursue the group goals.
Five actions for business after COP26
Following COP26, 2022 will be a year of action for businesses, according to EY Global Vice Chair – Sustainability, Steve Varley. To help businesses, he lists five action points they can take. They are:
1. Business must contribute to keeping the 1.5-degree C target alive and accelerate its efforts
2. it needs to prepare for the implications of the changing market and regulatory landscape
3. Businesses should expect and prepare for higher momentum on the convergence of sustainability standards
4. Businesses should consider adaptation as an important part of their agenda
5. Climate change is everybody’s business and business needs to engage with different voices.
He concludes, “Climate change is everybody’s business, and we can’t ignore that we all have a part to play. Businesses big and small, and the people behind them, are going to have to lean in and take action. Business faces an opportunity to further contribute to planet and society, rebuilding the trust deficit triggered by the financial crisis.”
Andrew Newby, Director of Operations at iResearch Services, says, “As highlighted elsewhere in this summary, cross-sectoral climate action must be taken by businesses of all shapes and sizes. It is not enough to just come up with pledges and promises. Prompt action also needs to be taken to limit the damage and disruption caused by climate change.”
UK advisors urged to help tackle climate crisis
Financial markets have a huge role to play in tackling the climate crisis – and financial advisors can play their part, says Lois Vallely, chief reporter of Money Marketing. She urges advisors to respond to a November discussion paper from the Financial Conduct Authority, which examines how the industry can encourage more investors to put ESG issues at the core of their investment decisions. “Transparency will be key when it comes to sustainability disclosures. And this is unlikely to come from self-assessment — which relies too heavily on interpretation and leaves the gate open for greenwashing. Companies will need to be held to account, whether sustainability standards are placed under the remit of an existing body or taken on by an entirely new one. I would urge financial advisers, and anyone else with an interest in financial markets, to respond to the regulator’s consultation to ensure the new requirements work for them, whatever form they take.”
UK Municipal Bonds Agency to issue first sustainable bonds
The UK Municipal Bonds Agency plans to issue its first sustainable bonds in the first three months of 2022. The agency, which helps councils access capital markets, is looking to issue a couple of sustainable bonds followed by a pooled ethical bond. Around 37 billion ($49 billion) of UK ethical bonds have been sold this year, estimates BNN Bloomberg. Councils need to have full political approval to proceed.
Green Finance Institute launches Green Mortgage hub
A new Green Mortgage Hub has been launched by the Green Finance Institute to inform and encourage lenders considering entering the market. It is also designed to be a trusted source of information for mortgage intermediaries, policymakers and NGOs focused on decarbonising the built environment. The UK sector is growing, with more than 10 mortgage lenders having launched green mortgage products over the last year and 77% of lenders planning to launch green mortgages that are cheaper or priced the same as a typical product. With one in five UK homes built before 1919 and half having uninsulated walls, the UK Climate Change Committee estimates that £250 billion needs to be invested in UK home upgrades by 2050. Emma Harvey, Programme Director of the Green Finance Institute, says, “The finance sector is starting to embrace the opportunities that green products offer to support their customers in the decarbonisation of their homes, and providing information, tools and case studies can help to encourage innovation. The Green Mortgage Hub will provide a snapshot of UK green home financing, acting as a resource for lenders to continue developing innovative green home finance solutions.”
IFAC identifies sustainability disclosure best practice
the International Federation of Accountants (IFAC) has identified emerging best practices as part of its vision for high-quality assurance of sustainability disclosure. The IFAC’s Vision for High Quality Assurance of Sustainability Information addresses the importance of global standards, supportive regulation and the value of an interconnected approach to sustainability and financial information reporting and assurance. IFAC Chief Executive Kevin Dancey says, “Sustainability information must take its rightful place in the corporate reporting ecosystem and stakeholder confidence must be on par with financial reporting.” Emerging regulatory frameworks should be designed to promote robust, decision-useful disclosure and disincentivize a compliance-based approach to both reporting and assurance, says the IFAC. High-quality, global standards – for reporting, assurance, and ethical professional conduct – play a key role in meeting this objective, and in avoiding unnecessary costs and reduced comparability and consistency that result from regulatory fragmentation.
Be Techinformed: 2022 sustainability predictions
AI and machine learning will play a pivotal role in sustainability in 2022, according to technology news publication techinformed.com. Says Mathias Lelièvre, CEO of Engie Impact:
“The challenge is that the underpinning carbon data is evolving much slower. Many leaders are rightly questioning whether they have the right data to act. But it’s not a binary question: Act or gather data. Companies don’t need to wait for perfect data to act as new technologies like artificial intelligence and machine learning are changing the way organisations think about decarbonisation data. These technologies can model missing data, project future scenarios and mobilise organisations to move at the pace required to reach Net Zero”
Also upfront and relevant in 2022 will be sustainable innovation, with businesses needing to consider ideas from external sources beyond their own enterprises. “Businesses that have embraced open innovation have found they can tap into an even greater resource than their own employees,” says Simon Hill, CEO of Wazoku. “Such collective expertise and knowledge are a powerful proposition and can be used to address the sustainability challenges the world is facing, navigate business issues, and unearth new opportunities.”
Tinu Thomas, Business Development Head, Lead Generation at iResearch Services, says: “Businesses are playing catch-up when it comes to sustainability. It is imperative that they look at technological solutions to help them both catch up and lead the way in sustainability efforts.”
“Technology plays an integral part in sustainability, across the board,” says James Pearce, Editor at techinformed.com. “Businesses must be aware of the latest developments so that they are able to adapt and innovate their sustainability practices to suit their evolving needs.”
Research-led and proudly independent, techninformed.com is affiliated with iResearch Services.
The Future of ESG Tech 2022
A new report outlines the Future of ESG Tech 2022 for the financial sector by examining the 17 Sustainable Development Goals (SDGs) laid out by the United Nations. The Finextra report examines how environmental, social and governance data can be utilised by financial institutions and fintech firms to achieve the SDGs and ensure global communities can migrate to a circular global economy.
UK clean air technology gets £64m grant boost
Successful applicants in the UK Direct Air Capture and Greenhouse Gas Removal Programme can bid for up to £5 million in grants from a £64 million pot. The programme seeks to identify and demonstrate Greenhouse Gas Removal solutions that have the potential to be replicated at significant scale. In Stage One, 24 projects were successful, featuring bioenergy co-located with carbon capture and storage; DAC arrays powered by nuclear energy and passive lime carbonation. Now, STAGE Two has been opened to them to move from feasibility to demonstration.
Stop standardising ESG data plea
The industry must stop standardising ESG data, says ESG consultant, Matt Moscardi. The constant calls by ESG users to “standardize” and “align” and “identify the proper metrics” are unnerving, he tells ResponsibleInvestor.com. He “suggests that, after more than 12 years in ESG, no one knows what the hell it is.” Specialization has left finance without adaptability. New data is unusable until there’s a textbook, a standard, or a codified method. Investors have a simple cognitive bias called functional fixation, he argues. “Functional fixation is the human instinct to do things the way they’ve always been done. Reject the new, the variable, and stick with tried and true.” He concludes, “The fact is this: ESG ratings being uncorrelated is exactly what we want. It isn’t a flaw; it is the plan.”
Competing standards may slow financial sector greening
A big issue impeding progress toward greening the business sector is having no clear, generally agreed framework for reporting the climate impact of corporate activity. Several competing models present different pictures, The Guardian reports. At least five different sustainable standard reporting measures have been proposed. It remains to be seen which one will win.
Which cities and companies are green A-listers?
Find out which cities and companies appear in the A-list for environmental transparency and action in the 2021 CDP Scores list. Companies are scored from A-D or F for failure to provide sufficient information by the environmental research body. Altogether, 95 cities are A-listers. A total of 200 companies have made this year’s climate change A-List, 118 are in the water security A-List and 24 make up the forests A-List. To score an A, among other actions, a city must disclose publicly and have a city-wide emissions inventory, have set an emissions reduction target and a renewable energy target for the future; and have published a climate action plan. An A-List city must also complete a climate risk and vulnerability assessment and have a climate adaptation plan to demonstrate how it will tackle climate hazards. It must also be making progress towards achieving its ambitious but realistic goals. The company scoring measures the comprehensiveness of disclosure, awareness and management of environmental risks and best practices associated with environmental leadership, such as setting ambitious and meaningful targets. CDP is a charity that runs the global disclosure system for investors, companies, cities, states and regions to manage their environmental impacts.
LEADERSHIP AND THOUGHT LEADERSHIP
SMEs must join COP26 climate change action too
Small and medium-sized enterprises (SMEs) have an integral role to play in building stronger and more resilient economies in line with the goals of COP26 and the Paris Agreement. If they do so, they can seize business opportunities now, environmental and climate reporter, Fermín Koop, tells Rio.ai. “We need to scale up climate action, and we need to do it fast. Collectively, SMEs account for about 90% of all businesses and 50% of employment worldwide. While individually each has a seemingly minor impact, together they are critical for responding to the climate crisis. What’s more, given the scale of emissions reductions needed, it requires a collective effort for all companies to act on their carbon footprint – both in their direct operations and in their supply chains.” It’s no longer just about doing the ‘right ‘and ‘responsible’ thing. “Climate risk is also now a material consideration for investments, with plenty of funding now moving into companies that already have robust climate commitments in place. Short and long-term – it’s not just a climate-responsible approach but an economically advantageous one.”
COP26 brought about a large expansion of the SME Climate Hub, with 170 new companies joining the 2,895 SMEs from 88 countries that have joined the hub, created by the We Mean Business Coalition, Exponential Roadmap Initiative and the International Chamber of Commerce. “If there’s one thing that COP26 showed, is that there’s big momentum for SMEs to work together amid the climate crisis,” he concludes.
Disruptive philanthropists look to make a difference
Measurable ESG actions and innovative solutions are becoming a top priority for philanthropists today to make a difference in the world. Disruptive philanthropists are taking a more active role in their giving, are aware of the vast inequities in the world, and are committed to making a difference on the major issues affecting society, according to a new KPMG report. Its 2021 Global Philanthropy White Paper finds that 71% of donors surveyed place measurable impact as key when selecting causes to support, with 42% citing innovative approaches as a strong influence in their giving practices. Yannick Archambault, Partner and National Family Office Lead, KPMG Enterprise, says, “Many successful individuals and families share a common belief that the opportunities that come with wealth should be balanced with a responsibility towards others. They are acutely aware of the immense needs that exist today and are focused on how they can meaningfully deploy their wealth for maximum impact. Increasingly, they are applying more rigour, analysis and data to their giving practices and leveraging their personal networks and skills to accelerate progress on some of society’s most complex challenges.” The main findings include:
- 58% identified good governance practices as a strong influence when choosing a charity to fund
- 42% cite innovative approaches as a strong influence in their giving practices
- 67% have adopted data as part of their evaluation of impact
- 42% want structured feedback from their beneficiaries
- 63% agree that combining efforts with third parties needs to happen to deliver true impact, but 28% find collaboration a challenge.
Yogesh Shah, CEO at iResearch Services, says, “Philanthropists are getting smarter about how they can use their wealth to do good. Using data and measurable outcomes to see what methods work best is becoming more widespread. That is something iResearch Services applauds. The better the quality of data and analysis, the greater the good that can be done.”
The Energy Evolution
As part of our Thought Leader’s Voice podcast series, we are thrilled to be in conversation with Adrian Del Maestro on ‘The Energy Evolution: A Sustainable Energy Transition for Growth’.
Key takeaways from the podcast:
-What are the key factors influencing the energy transition, particularly in the context of a growing focus on decarbonization?
– What are the technological innovations that have the power to mitigate the impact of hydrocarbons and how are business strategies evolving to shape a cleaner business?
– What is the role of regulation, partnerships/collaborations and cost on the route through an energy transition?
Join the conversation, hosted by iResearch Services Editor-in-Chief Rachael Kinsella, as Adrian shares with us how decarbonization is changing the way businesses think and why this is the decisive decade for the Energy industry.
Says Prosenjit Ganguly, AVP Sales and Client Success at iResearch Services, “Businesses need a clear organisational roadmap to deal with the myriad changes within the energy industry, especially in light of the energy transition, to enable them to move forward in a structured and systemic way.”
Johnson & Johnson takes big step towards 100% renewable energy
Healthcare company Johnson & Johnson is to source the equivalent 100% renewable electricity for all sites in Europe, the United States, Canada by 2023. The move to wind and solar power follows a power purchase agreement (PPA) in the United States. Johnson & Johnson aims to use 100% renewable electricity for all its operations by 2025. The new agreement with Ørsted uses a solar array in Southern Texas to generate up to 55 megawatts (MW) or approximately 117,000-megawatt hours (MWh) of renewable electricity annually. Existing on-site and off-site renewable projects currently provide about 70% of Johnson & Johnson’s electricity needs in the U.S. and Canada. Johnson & Johnson Vision’s production site in Limerick, Ireland is already powered by wind.
Chief Sustainability Officer, Paulette Frank, says, “Last year we announced our most ambitious climate goals to date, including an accelerated renewable electricity goal. We are wasting no time making progress because we know there is no time to waste – the world needs bold climate action to advance both human and planetary health.” The North America deal follows the completion of three PPAs in Europe for wind and solar installations, announced in July. To date, the Company has built over 50 on-site renewable energy systems on properties in 14 countries and has executed 15 deals for off-site renewable electricity procurement. At the end of 2020, 54% of Johnson & Johnson’s global electricity came from renewable sources.
Diversity and sustainability targets linked to loan
A loan to a Canadian renewable energy provider will be set at more favourable terms if it meets sustainability and diversity targets. BMO Financial Group will reduce the borrowing costs of wind, solar and hydroelectricity specialist Boralax if it achieves pre-determined sustainability targets under the five-Year, $525 million Revolving Credit Facility. These consist of CO2 emissions avoidance levels and equal opportunities for women including representation in management positions.
Jonathan Hackett, Head, Sustainable Finance, BMO Capital Markets, says, “Helping clients like Boralex reach their ESG goals is another way BMO is boldly growing the good in business and life. Deals like this are a great example of the way BMO works with clients across industries both to serve their needs and work toward a more sustainable future. Sustainable lending continues to grow rapidly worldwide and in Canada, and BMO is proud to be the leading Canadian bank for SLL structuring.” BMO has committed to deploy $300 billion in sustainable lending and underwriting to companies pursuing sustainable outcomes by 2025.
Interactive ESG Guide for materiality assessment
Want help when drawing up an ESG reporting programme? This Interactive ESG Guide for Materiality Assessment from governance, risk management, and compliance specialist, workiva, helps you focus on the topics that matter most to your stakeholders. The template helps you decide what is materially important to your organisation and breaks the process down into four simple steps. Examples of a materiality map or materiality matrix are included. Registration is required for free download.
SUSTAINABILITY STORIES YOU MAY HAVE MISSED
- Carbon offsets still are not settled (GreenBiz)
- The Sustainability Standards Battle (Project-Syndicate.org)
- Sustainable Tech for UK financial services (GlobalBankingandFinance.com)
- Jersey joins the international Network of Financial Centres for Sustainability (JerseyEveningPost)
- How banks can achieve net-zero pledge by 2050 (GreenBiz)
- Why banks can no longer ignore climate change (TheFinancialBrand)
- Seven Ways Businesses Must Prepare For The Growing Focus On ESG (Forbes)
- New class of ESG Heads looks nothing like the old (TheMiddleMarket.com)
- ESG choices are key to building reputation (EconomicTimes)
- Bank chief urges policymakers to step up on climate change (Euromoney – subscription required for full piece)
- Green bonds face new questions over authenticity (FT)
- Piraeus Bank issues first Green Senior Preferred Bonds (Piraeus Bank)
- Why B2B Financial Services Should Meet the ESG Criteria (FinTech)
- Sustainability and Innovation Spur Business in Brazil (Global Finance)
- UK companies set to ESG hiring spree in 2022 (The National)
- Britain turns to bankers to help meet climate goals (NYTimes)
- Activist activity surges at FSTE firms (CityAM)
FIND OUT MORE
Want to know how sustainable the financial services sector is? We crunched the data from 550 senior decision-makers across Europe, Australasia, China, Japan, the USA, UK, Russia, and India, to find out their thoughts in our latest report. Download it today.Back to Blogs