US companies are facing a record number of shareholder resolutions on climate change, according to investor groups Ceres and the Interfaith Center on Corporate Responsibility. State pension funds, religious funds and other institutional investors filed 31 resolutions asking major companies to disclose the greenhouse gases they emit and their plans to reduce them, following concerns that high emissions leave firms vulnerable to regulatory change. Targets included Ford, Chevron Texaco, and Dow Chemical, with the 31 filings for the 2005 proxy season easily exceeding the 22 resolutions filed last year. Contact Peyton Fleming, Ceres 00 1 617 247 0700 ( http://www.ceres.org)
GOOD PROSPECTS
Responsible companies outperform less responsible companies by 4.8% over four years, and 3% over 10 years, according to a study of 300 companies by Australian funds manager AMP Capital Investors, suggesting that investing in ethically responsible companies can reap better returns over the longer-term. The study assessed a company’s social responsibility on the basis of its occupational health and safety record, its impact on local communities and the independence of the company’s board. It then stripped away other factors that affected the company’s share price such as its sector performance and size to assess the specific impact on the share price of a company’s corporate social responsibility. Contact Jillian Maxwell, AMP 00 61 2 9257 2766 ( http://www.ampcapital.com.au)
ATTACHING STRINGS
UBS Investment Bank has launched a programme to integrate environmental and sustainability criteria into the bank’s overall assessment of investment risk and opportunity. UBS says that as a financial institution, it is important to consider the downstream effect of its lending and investing activities on the environment, the rights of workers, communities and indigenous people. Contact Sarah Small, UBS 020 7568 2609 ( http://www.ubs.com)
SRI IN ISRAEL
The Tel-Aviv Stock Exchange has launched the Maala Socially Responsible Investing Index. The index comprises the shares of the top 20 companies on a social responsibility rating compiled by. Maala, a non-profit professional organisation for businesses that are leaders in working towards social change in Israel. It promotes social and environmental responsibility in business and rates companies according to their level of community involvement and contribution to society. Criteria include contributions relative to profit, companies’ conduct towards their employees, customers, suppliers and the community and environment at large. Contact Ofer Simchony, TASE 00 972 3 567 7405 ( http://www.tase.co.il)
…AND AUSTRALIA
Newspaper The Australian has partnered with fund manager Sustainable Asset Management to launch the Australian SAM Sustainability Index (AuSSI) on February 17. The index features 70 companies picked from the ASX200, which outperform their peers on a range of environmental and social criteria. Contact Francis Grey, AuSSI 00 61 39696 4011 ( http://www.aussi.net.au)
FTSE4GOOD RIDDANCE
UK-based Virgin Mobile, Surfcontrol and Management Consulting Group were among 7 UK companies added to the FTSE4Good Index on March 18. In total 61 companies were added to the index, a third of which are Japanese. Globally, 27 companies have been removed from the index, 23 of which no longer meet the index’s more stringent environmental criteria. Other criteria on which companies are assessed include developing positive relationships with stakeholders and upholding and supporting universal human rights. Contact Jo Mayall, FTSE4good 020 7448 1821 ( http://www.ftse4good.com)
In brief
Calvert, a US-based manager of socially responsible mutual funds, has signed up to the European Social Investment Forum’s new Transparency Guidelines. Calvert will publish its disclosures on its website. Contact Elizabeth Laurienzo, Calvert 00 1 301 657 7047 ( http://www.calvert.com)
Editorial Comment
SRI has long suffered from the view in some quarters that it is at best a preoccupation of (some) Anglo-Saxon investors. Certainly the best-established ‘ethical’ funds are based around London and New York. News that Tel-Aviv has launched an SRI index, along with other news we report here, show this is changing. That’s to be expected, as some drivers of SRI are universal: sustainable development, good corporate governance and a pragmatic approach to risk. But scratch below the surface and it’s noticeable that most interest is coming from countries closest to the ethical and cultural values of the Judeo-Christian tradition. Indeed ethical investment started in 1920s Britain with the Methodist church avoiding so-called ‘sin stocks’ in alcohol and gambling. It is driven in today’s America by similar religious concerns. We’ll know SRI has arrived big time, when the Mumbai and Jakarta stock exchanges feature funds reflecting Hindu and Muslim sensibilities – and that will challenge western views about what ethical investment really is.
Corporate Citizenship Briefing, issue no: 81 – April, 2005
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