SUSTAINABLE INVESTMENT

BlackRock launches temperature-aligned investment funds

The world's largest investor BlackRock has unveiled two new temperature-based exchange funds aimed at helping investors align portfolios with the pathways of the Paris Agreement. The funds are designed to mitigate financial exposure to both physical climate risks and transitional risks as the globe moves towards a low-carbon economy. As such, the products assist investors in screening out exposure to fossil fuels, controversial weapons, high carbon electricity generation, and social norm violators. The funds meet the minimum standards of the EU ‘Paris Aligned Benchmark label’ –an investment benchmark that incorporates criteria related to emissions reductions. The funds are also categorised as Article 9 under the European Union’s Sustainable Finance Disclosure Regulation (SFDR), which applies to investment projects that have sustainability as a key objective. (Edie)

STRATEGY

Yum! Brands sets emission reduction goals for supply chain and restaurants

KFC, Pizza Hut and Taco Bell parent company Yum! Brands announced today new environmental sustainability goals aiming to reduce emissions across the company’s 50,000 corporate and franchise restaurants and throughout its supply chain. The company’s new targets are approved by the Science Based Targets initiative (SBTi) and include cutting GHG emissions generated by its corporate restaurants and offices, (Scope 1 and 2)by 46% below 2019 levels by 2030. It will also work alongside franchisees, suppliers and producers to match the 46% reduction in the same timeframe in its Scope 3 emissions, on a per-restaurant basis for franchisees and a per-metric ton basis for beef, poultry, dairy and packaging. The company has also committed to achieve net zero emissions by 2050. (ESGToday)

DIVERSITY & INCLUSION 

Walmart shows rising gender and racial diversity in leadership roles

US retailer Walmart has reported rising representation of women and greater racial diversity in officer roles, as the firm strives to better reflect the country’s diversity among its top leadership. Its latest annual diversity and inclusion report shows nearly 75% of Walmart employees in officer roles are white, with 8.42% of roles 25% held by Black or African-American employees. Walmart’s representation of women and racial diversity at the officer level rose 1.03% and 0.61%, respectively, over the past year. Walmart, like other companies across corporate America, pledged to diversify its workforce after facing heightened pressure to show advancing racial equity after the pandemic and the murder of George Floyd illuminated sharp racial disparities. (CNBC)

ETHICAL BUSINESS

US companies boost sustainability scores in ESG ratings

US companies’ sustainability ratings rose in 2020, according to data solutions provider Refinitiv, as investors put more pressure on corporate boards to improve their environmental, social and governance (ESG) credentials and as authorities propose tougher disclosure rules. Latest rankings from Refinitiv based on company annual reports for 2020, shows the average ESG score of 137 US companies, with a market cap of at least $5 billion, is 44.2, compared with 42.8 in 2019. Still, US companies' average score lagged their European peers, whose average was 58 at the end of last year. Investors are demanding more information from companies on everything from carbon emissions to boardroom diversity, amid a growing belief that companies which perform well on ESG issues will have a stronger performance financially over time. (Reuters)

POLICY & RESEARCH

US Treasury Secretary endorses TCFD and IFRS sustainability initiatives

US Treasury Secretary, Janet Yellen, has expressed support for sustainability reporting initiatives, including the TCFD framework and the IFRS initiative, towards developing a climate disclosure standard. The Secretary, argues that a  lack of reliable, consistent, and comparable climate-related disclosures has been a key obstacle in the mobilization of capital from the private sector towards financing the green transition. To address issues with reporting, Yellen highlighted existing and emerging initiatives to set climate reporting standards, including the Financial Stability Board’s Task Force on Climate-related Financial Disclosures (TCFD), and the International Financial Reporting Standards Foundation’s (IFRS) work to establish a ‘Sustainability Standards Board’ that will focus on developing a climate disclosure standard. The Treasury will work with the SEC as it reviews its own rules for sustainability reporting requirements by companies. (ESGToday)