The E in ESG: Sustainability News Roundup
Investors are under increasing pressure — from a risk, performance, and regulatory perspective — to ensure their fixed income portfolios take ESG issues into account.Our survey found that integrating ESG considerations is the top priority for asset managers, wealth managers, and corporate pension funds to address through their fixed income allocations over the next 12 months.
2. How to improve the quality of Scope 3 emissions data and reporting
Supplier engagement will be key to improve the measurement and reporting of Scope 3 emissions, but this is only one side of the picture. An influx in further data will render manual data management systems as inadequate, requiring the investment in more efficient data management systems.
3. Global Sustainability Disclosure Standards for Companies Set to Take Effect in 2024
The International Sustainability Standards Board said it has agreed to rules that would harmonize corporate environmental disclosures across the globe.
At a meeting held Thursday, the board voted to release global guidelines midyear that would go into effect in January 2024. ISSB is backed by the Group of 20 advanced and developing economies and is part of the International Financial Reporting Standards Foundation, an accounting body overseeing financial reporting such as corporate earnings.
4. AXA IM aligns compensation of senior executives to its ESG ambitions
As part of its commitment to becoming net zero as a business and investor by 2050 to help the transition to a more sustainable world, AXA Investment Managers (AXA IM) is now including ESG targets in the remuneration of its senior executives.
5. ESG Is Going to Have a Rocky 2023. Sustainability Will Be Just Fine.
“…it’s clear that the sustainability movement is, if anything, accelerating. For example, the percentage of S&P 500 companies including ESG metrics in compensation plans rose to 70% in 2022, up from 57% just a year earlier, with measurements of carbon footprint and diversity and inclusion growing the fastest.”
6. Save energy, decarbonize and transition to renewables while operationalizing sustainability
Recent political and climate-related environmental events have impacted energy sourcing, supply and costs. The resulting energy crisis impacts all countries, industries, sectors and societies across Europe. Combined with imminent reporting requirements from the European Commission, saving and securing energy sustainably and moving to renewable energy sources equitably is imperative.
7. Corporations push “insetting” as new offsetting but report claims it is even worse
There is no single and universally-accepted definition of insetting, but the term generally refers to a company offsetting emissions through carbon reduction or removal projects along its own supply chain. Insetting is most commonly used by corporations with a large land footprint and involves protecting nature.
But the NCI claims insetting is just a rebranding operation for “low-standard” offsetting. “The impression is that offsetting has gained a bad reputation, so companies are moving to a different term to avoid criticism, rather than abandoning it altogether,” Silke Mooldijk, co-author of the NCI report, told Climate Home News, “This distracts from the need for real emission reductions”.
8. World Bank proposes freeing up $4bn by loosening lending rules
The World Bank, under pressure to do more to help developing countries cope with climate change, may change its internal lending guidelines to free up $4 billion in lending capacity each year, World Bank President David Malpass said on Thursday.
9. The Financial Benefits of ESG and Sustainability: Quantifying the Financial Impact
There are a variety of financial models that can be used to estimate the financial impact and benefits of ESG and sustainability, including cost comparison models, energy savings models, waste reduction models, carbon footprint models, and more. These models can be applied to any product, company, or business and can help identify areas where sustainability improvements can be made to reduce costs and environmental impact.
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10. What to consider when buying carbon offsets
Purchasers must have the confidence and assurance that the carbon offsets purchased reflect the permanent reduction or removal of CO2 from the atmosphere that would not have otherwise been removed. The lack of standardization in the voluntary carbon markets, questions about the permanence of carbon offsets and the lack of market transparency are among the issues that purchasers or potential purchasers of carbon offsets often face.
11. IT Asset Disposition is Critical to Sustainability Goals
12. 4 Ways ITAD Can Help With Your Sustainability Goals
Sustainability Reporting
The importance of corporate reporting is rising amid efforts to assess, quantify and communicate ESG (Environmental, Social, and Corporate Governance) metrics, and progress toward net-zero carbon emissions and other sustainability goals. It is often stated that what gets measured gets improved and measuring progress builds team awareness and buy-in.
ITAD activities are a pivotal way to provide data back to your organization to show progress towards sustainability goals, however this opportunity is often missed. Collecting information across internal divisions or from multiple ITAD and recycling partners can pose a challenge. A best practice in reporting is done by a lead partner or by consolidating activities with the right ITAD partner.
13. How regulations are moving ESG into the risk and compliance field
14. The Ultimate Guide to Understanding Carbon Credits
15. Who Verifies Carbon Credits
16. Revealed: more than 90% of rainforest carbon offsets by biggest provider are worthless, analysis shows
17. Are Carbon offsets a scam? Key points to consider
18. Greenwashing or a net zero necessity? Climate scientists on carbon offsetting
19. ESG Monthly Newsletter (Sullivan & Cromwell LLP)
SEC confirms expected timing of new ESG rules, including on climate disclosures. The SEC is expected to take final action on its proposed new climate-related disclosure rule in spring 2023, according to the Fall 2022 Unified Agenda of Regulatory and Deregulatory Actions released by the Office of Management and Budget’s Office of Information and Regulatory Affairs in January 2023 (the “Agenda”). The new rules, proposed in March 2022, would require expansive new disclosures from issuers on climate change and greenhouse gas emissions. The final rules were expected as early as October 2022 but were delayed, with SEC speakers declining to discuss the scope and timing of the final rules in recent remarks. According to the Agenda, the SEC is also expected to take action by fall 2023 on amendments related to ESG and the asset management industry, including proposed amendments to rules and reporting forms relating to the incorporation of ESG factors by registered investment companies and business development companies and separately proposed amendments to Rule 35d-1 under the Investment Company Act of 1940 (the “Names Rule”) that would address the use by investment funds of names indicating that their investment decisions reflect ESG factors. Please see S&C’s memos on the Names Rule and ESG disclosures for investment advisers and investment companies for more information.
FTC seeks comments on revisions to the Green Guides.
On December 14, the Federal Trade Commission (“FTC”) voted to approve a public consultation period on updates to its Guides for the Use of Environmental Marketing Claims, known as the “Green Guides.” Established in 1992 and last revised in 2012, the Green Guides define and standardize the use of sustainability-related terms to prevent false or misleading advertising claims, known as “greenwashing.” The FTC regularly cites the Green Guides in its enforcement cases, and states such as California have incorporated them into state law. Proposed updates could include the addition of guidance on how consumers interpret the term “sustainable” and further guidance on advertising related to carbon offsets or climate change.