SUSTAINABLE INVESTMENT

BlackRock’s funds face ESG criticism from New York Comptroller

The New York City Comptroller has said he is reassessing business relationships with BlackRock, among other asset managers, on concerns that it is straying from its “climate commitments”. The asset manager has faced criticism from both sides of the debate on low-carbon fuels, with environmentalists arguing it does too little and Republican politicians accusing it of boycotting energy stocks. Regulators have become concerned that US funds looking to cash in on the popularity of ESG investing may be misleading shareholders over their ESG credentials. The City Comptroller said: “BlackRock cannot simultaneously declare that climate risk is a systemic financial risk and argue that BlackRock has no role in mitigating the risks that climate change poses to its investments by supporting decarbonisation in the real economy”. (Reuters)

STRATEGY

Sustainable fuel start-up Air Company sells to JetBlue, Virgin Atlantic

Sustainable fuel start-up Air Company has multi-year agreements to sell jet fuel made from captured carbon emissions to carriers JetBlue Airways and Virgin Atlantic. Under the memoranda of understanding, JetBlue will buy 25 million gallons Air Company's sustainable aviation fuel (SAF) between 2027 and 2032. Virgin Atlantic will purchase up to 100 million gallons of SAF over 10 years. Air Company said it uses carbon dioxide from a variety of sources, such as ethanol plants, to make SAF. The global aviation industry is under pressure to reduce carbon emissions and find ways to meet the 2050 net-zero emissions targets set by the International Air Transport Association. Global airlines and aerospace manufacturers are betting on SAF, which can cost two to five times more than conventional jet fuels. (Reuters)

CORPORATE REPUTATION

Boeing to pay $200m to settle claims it misled investors over crashes

Aerospace company Boeing and its former chief executive have settled an investigation by the US Securities & Exchange Commission into allegedly misleading statements involving two deadly crashes. Boeing will pay $200 million to settle charges that it misled investors and the former chief executive has agreed to pay $1 million. The two fatal 737 Max jet crashes took 346 people’s lives, led to the grounding of the Max fleet and global investigations. The SEC launched its investigation into company statements after Boeing investors lost billions. The SEC concluded in its findings that Boeing deliberately misled the public about the safety of its flight control function used in the Max fleet. In 2021, Boeing was fined $2.5 billion by the justice department after being charged with fraud and conspiracy. (The Guardian)

ENERGY

UK’s poorest risk spending half disposable incomes in energy bills

Britain’s poorest households risk spending almost half of their disposable income on gas and electricity bills despite the government’s energy price guarantee. Think-tank the Progressive Economy Forum (PEF) said the poorest tenth of families could face bills amounting to 47% of their disposable income in winter. Average energy bills will be frozen by the government at £2,500 for a typical family from October for the next two years. However, the government has faced criticism for failing to provide support for the poorest households. According to PEF, a household on average income is forecast to spend a third of their disposable income on energy bills, almost double the 17% they paid in 2020. Households in the top 10% will only be paying a fifth of their disposable income. (The Guardian)

LAWSUITS

Brussels sued for including fossil gas in EU’s green finance taxonomy

Four environmental groups started legal action against the European Commission after the EU executive passed a contentious law to include fossil gas into its list of sustainable investments. Earlier in 2022, the European Commission gave gas power plants a ‘sustainable’ label under the EU’s green taxonomy, provided the technology meets a certain CO2 emissions threshold. But environmental NGOs, ClientEarth, WWF’s European Policy Office, Transport & Environment, and BUND, argue that gas is a potent fossil fuel that threatens European energy security and has led to record energy prices. The Commission now has up to 22 weeks to reply before the EU Court of Justice is asked to rule on the matter and potentially repeal the law – called a Delegated Act. (edie)

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