Behind the ESG headlines - March 25, 2022

By mathew-loup

Board diversity, environmental, social and governance (ESG) issues and new frameworks take the headlines in our latest collection of articles, blogs, reports or videos.

1. Although boards of directors are making changes on establishing gender equity, that progress is still painfully slow, according to a study by MSCI. The latest MSCI All Country World Index shows that 22.6% of board seats are held by women directors, up from 21% in 2020. If this growth rate does not quicken, it will not be until 2042 that boards have 50% representation by women. 

2. The Taskforce on Nature-related Financial Disclosures (TNFD) has delivered its beta framework for managing nature-related risks and opportunities. Its is based on three key components:

  • Fundamental concepts and definitions of risk and opportunity
  • Draft disclosure recommendations
  • Guidance for companies and financial institutions on how to conduct a nature-related assessment

 The final framework is scheduled for release in fall 2023.

3. The demand for better ESG disclosures is putting pressure on public companies in the US. A new survey by Deloitte of sustainability, legal and finance leaders highlighted the challenges ahead. Around 90% of the companies surveyed acknowledged that they needed to invest more in technology to produce the data required for accurate and consistent measurement, reporting and disclosures. Just over eight in 10 (82%) also said that they needed extra resources to generate the disclosures their stakeholders now demanded.  

4. An environmental charity is suing Shell’s board of directors for failing to prepare properly for the advent of net zero. ClientEarth claim the the directors are personally liable for not delivering a strategy that would align the oil and gas giant with the Paris agreement. One of the key aims of that deal was to limit fossil-fuel emissions to try and limit global heating increases by 2C. 

5. Apples meet oranges. A new survey by GaiaLens of asset managers and owners found that just under one in four respondents (23%) were happy with the quality of the ESG data and ratings they had to hand. Nearly three in 10 (28%) said the dissatisfaction was caused by a “lack of clarity, transparency, and robustness in the methodologies”. Other responders were dissatisfied with the over attention given to the “E” part of ESG at the expense of the other two components. 
Mathew Loup is Competent Boards’ Director, Marketing & Communications. Connect with him on LinkedIn.

Behind the ESG headlines
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