REPORTING

Glass Lewis launches new ESG scores and data feature

Proxy advisory services provider Glass Lewis has announced the launch of ESG scoring and data featured in its proxy paper research reports. While these reports previously included third-party ratings from Sustainalytics and Arabesque – Glass Lewis will now include its own bespoke scoring of ESG data alongside contextualising data to help its investor clients to vote and engage with companies in an informed way on specific ESG proposals at annual meetings. ESG data will be collected and provided to shareholders and to public companies in advance of their annual general meetings, “allowing for voting decisions and engagement to occur with timely data and research specific to agenda items”. Glass Lewis also notes that investors can make use of the underlying data and scoring in their custom voting policies. (Glass Lewis)

SUSTAINABLE INVESTMENT

Morningstar cuts 1,200 funds from its ‘sustainable’ list

Financial services company Morningstar has removed over 1,200 funds with a combined $1.4 trillion in assets from its European sustainable investment list. The company dropped the funds after closely examining disclosures provided to investors such as prospectuses and annual reports. The cull underscores the challenges in ensuring sustainable investment products meet customers’ expectations and makes a positive impact on the environment. This comes shortly after Morningstar reported that assets in European funds recorded as sustainable had reached €4 trillion. Morningstar previously warned that “loose definitions” in the EU’s Sustainable Finance Disclosure Regulation allowed fund managers to reclassify assets as sustainable without making changes to their portfolio. Most of the removed funds declared their sustainable credentials under the EU’s “light green” Article 8 section, meant for funds “promoting” environmental and/or social characteristics. (Financial Times)*

SUPPLY CHAIN

Large retailers drop suppliers over ESG concerns

A report published by multinational bank Barclays has found that 21% of the UK’s largest retailers have collectively cancelled £7.1 billion in contracts with suppliers over the past 12 months over failure to meet environmental, social and governance (ESG) standards. The most common reasons include use of materials from suppliers not meeting sustainability criteria, and evidence that suppliers failed to provide adequate working conditions, pay and hours to staff. Retailers also dropped suppliers for failing to join trade bodies and/or sustainability certification schemes to evidence they were meeting standards. The study covers 302 retailers and concludes that an increased focus on ESG among investors, workers and the public was a key driver behind ending work with suppliers. (edie)

CLIMATE CHANGE

New framework helps monitor sector decarbonisation

The private sector-led low-carbon group Transition Pathway Initiative has published sector-specific decarbonisation pathways for ten of the world’s highest-emitting sectors. Among them, include three of the world’s highest-emitting sectors – energy, transport and industrials – with sub-sector-specific decarbonisation goals. The pathways are designed to help investors assess whether corporates are delivering the emission reductions demanded by climate science within a suitable timeframe. Investors in shipping, airlines and oil and gas majors and other heavy emitters will be able to monitor whether their emissions reductions are aligned with a 1.5°C temperature pathway or 2°C temperature pathway in any given year from now through to 2050. Other sectors included are electric utilities, automotive, aluminium, cement, mining, pulp and paper, and steel. (edie)

TECHNOLOGY & INNOVATION

Major breakthrough reached on nuclear fusion energy

Scientists in the UK-based JET laboratory say they have achieved a major breakthrough in developing practical nuclear fusion. The milestone was achieved at the Joint European Torus (JET) laboratory in which is made up of thousands of engineers, scientists, students and other experts across Europe. The laboratory smashed its own world record for the quantity of energy it extracted by squeezing together two forms of hydrogen, producing 59 megajoules of energy over five seconds (11 megawatts of power). This achievement is more than double what was previously reached in similar tests in 1997. While the energy output is only about enough to boil 60 kettles’ worth of water, the breakthrough validates design choices that have been made for an even bigger fusion reactor now being constructed in France. (BBC News)

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