More than 90 institutional investors representing over $6.7 trillion in assets under management have written to the Roundtable on Sustainable Palm Oil (RSPO) calling on it to strengthen its green certification standards for palm oil production. The letter raised concerns over the “relevance and effectiveness” of the multi-stakeholder certification body, which aims to boost sustainability standards across the palm oil industry. “Our investment portfolios include companies that have significant exposure to deforestation risks and therefore, have made robust no-deforestation policies and strong commitments to sourcing sustainably certified palm oil,” the letter states. “As such, both investors and companies rely on the RSPO to ensure reliable supplies of verified sustainable palm oil.” The letter was coordinated by US environmental non-profit Ceres, with signatories including Aviva Investors, Aegon Asset Management, the New York State Common Retirement Fund and Hermes EOS. (BusinessGreen)
Governance
Royal Mail fined record £50 million for allegedly breaking competition law
Royal Mail has been fined a record £50 million by the UK communications regulator for breaching competition law. Ofcom said the company had abused its dominant position by discriminating against wholesale customers such as Whistl, which sought to deliver bulk mail. The penalty followed an investigation into a complaint by Whistl about changes Royal Mail made to its wholesale customers’ contracts in early 2014, including price increases that Whistl claim forced it to suspend expansion plans that would have put it in direct competition with Royal Mail by delivering business letters in parts of the UK. Royal Mail said it was very disappointed by Ofcom’s decision and strongly rejected any suggestion that it broke competition law, adding that that the decision was “without merit and fundamentally flawed”. (Guardian)
“Due diligence” on AU$444 million Great Barrier Reef grant was for separate project
Due diligence the Australian government says it conducted before announcing an AU$443.8 million grant to a not-for-profit group was actually conducted as part of an application for funding for a separate project, the Great Barrier Reef Foundation says. This contradicts claims from environment and energy minister, Josh Frydenberg, who has said that “extensive due diligence” took place before awarding the foundation almost half a billion dollars of taxpayer money, including seeking information about the foundation’s operations and structure prior to a meeting on 9 April 2018. The foundation says the information referred to was actually supplied as part of an application by the foundation for funding for a separate project and it had no conversations with the government regarding the grant before 9 April 2018. Pressure has been growing on Frydenberg and Malcolm Turnball to explain who had the initial idea to award the foundation the money without a competitive tender process. (Guardian)
Energy
Facebook leads record clean power purchases in 2018
Corporations are purchasing more clean energy than ever, with 2018 already exceeding the record-amount set in 2017. 7.2 gigawatts (GW) of clean power has so far been agreed between corporate companies, such as Facebook, and wind and solar developers. The amount for the first seven months of 2018 surpasses the 5.4 GW signed across the whole of 2017, itself a 20 percent uplift on the previous year. Analysts from Bloomberg New Energy Finance (BNEF) released the data, which show the United States and the Nordic countries responsible for 80 percent of all purchases across 28 markets. Facebook has already inked 1.1GW of agreements in 2018, followed by AT&T on 820 megawatts (MW). Norway’s Norsk Hydro has signed 667 MW, including a 29-year onshore wind deal in Sweden, reportedly the longest such agreement in the world. (Climate Action Programme)
Responsible Investment
DBS and Wilmar sign US$100 million sustainability linked-loan
Asia’s leading agribusiness group Wilmar International is collaborating with Singapore lender DBS to promote corporate responsibility through a sustainability-linked loan. The collaboration, announced on August 10, will peg the interest rate of Wilmar’s existing two-year US$100 million revolving credit facility to a series of environmental, social and governance (ESG) performance metrics as its links its sustainability improvements with its corporate financing activities. The interest rate for this loan is based, in part, on the ESG rating of the company by Sustainalytics, a global provider of ESG research and ratings, and will be reduced on a tiered basis if pre-determined targets are achieved. WIlmar has already forged similar arrangements with two other banks, incorporating sustainability metrics into aspect of its business. Yulanda Chung, head of sustainability, institutional banking group at DBS: “We see a growing market of sustainability-linked loans, which enable lenders to incentivize and reward corporations to advance their sustainability agenda.” (The Asset)
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