GlaxoSmithKline and Burberry have been accredited as UK Living Wage employers, extending payment of the hourly rate to sub-contractors such as cleaners and security staff. The move will take the number of Living Wage employers in the UK to over 1,400, and brings the total of FTSE 100 companies who have applied for accreditation with the Living Wage Foundation to 23. The Living Wage rate is £7.85 an hour, and £9.15 in London, well above the statutory adult minimum wage figure of £6.50 (rising to £6.70 in October). The campaign was originally started by parents in East London, who found that despite working two or more minimum wage jobs, they were struggling to make ends meet. ShareAction, a responsible investment charity, has been mobilising institutional investors in an investor collaborative for the Living Wage, and has been in dialogue with Burberry and GSK through AGM questions and investor engagement since 2011. (Yahoo News; ShareAction)
Supply Chain
Adidas terminates deals with suppliers over non-compliance
Adidas terminated agreements with 13 suppliers in Asia last year for non-compliance, according to the sportswear company’s 2014 sustainability report. Adidas said it worked closely with suppliers to help them improve their performance, but in situations of severe or repeated non-compliance, it had ended its business relationships. The company’s global sourcing team, which works to pre-screen potential new suppliers, assessed 226 factories last year, rejecting 104. Some are rejected on a first visit, and others get three months to fix problems before being re-audited. Adidas also issued 65 warning letters to suppliers in 13 countries about ongoing serious non-compliance issues. The warnings were for issues including poor management commitment, excessive working hours, the non-payment of wages and benefits, poor electrical, fire or chemical safety, poor communication and transparency problems. (Supply Management)
Governance
UK’s big four banks face extra £19bn in fines, analysts predict
The UK’s big four high-street banks face another £19 billion of conduct and litigation charges by the end of 2016 as they continue to pay the price for past mistakes, according to analysts. The estimates, from ratings agency Standard & Poor’s, are for Barclays, HSBC, the Royal Bank of Scotland and Lloyds Banking Group. Including other banks, such as Clydesdale, Yorkshire and Co-op, and the Nationwide and Yorkshire building societies, the total cost of the scandals to hit 13 financial firms in the 5 years to 2014 amounted to £48 billion. The £19 billion estimate for the big four banks in the next two years is less than the £22 billion for the past two years, and the bill for past errors could start to subside. The extra costs are due to continuing compensation for retail customers but also other issues such as foreign exchange, Libor and money laundering errors. (The Guardian)
Environment
EU to take carbon market decision the size of Cambodia
European Union decision makers are closing in on reforms to tackle a glut of pollution permits in the carbon market. The difference between two options on reforms to the key climate policy is 153 million tonnes of CO2, say analysts. That is equivalent to a year’s output from 50 coal power stations, or Cambodia’s entire energy use. Yet member states are still divided over the speed of reforms, a decision with significant impact on greenhouse gas emissions over the next decade. It hinges on the start date for a “market stability reserve” to combat the oversupply of allowances. Lawmakers in the European Parliament settled on 2018, while heads of state in the European Council have agreed on 2021. Eastern European countries have raised concerns that the cost of allowances on the emissions trading system (ETS) could make their heavy industry uncompetitive against foreign rivals. (RTCC)
New York state to dim lights to save migrating birds
The state of New York is to turn off non-essential lights in state-run buildings to help birds navigate their migratory routes in spring and autumn. Migrating birds are believed to use stars to navigate but they can be disorientated by electric lights, causing them to crash into buildings. The phenomenon, known as “fatal light attraction”, is estimated to kill up to one billion birds a year in the US. New York Governor Andrew Cuomo said on Monday that bright outdoor lights will be turned off between 23:00 and dawn during peak migration seasons in spring and autumn. The state will join several well-known New York landmarks that have already signed up to the National Audubon Society‘s Lights Out programme, including the Rockefeller Centre, Chrysler Building and Time Warner Centre. (BBC News)
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