Behind the ESG headlines - May 6, 2022

By mathew-loup

India caught the headlines recently with its extreme heat, another example of climate-change induced weather patterns with global consequences. It’s another illustration of the complex environmental, social and governance (ESG) risks and opportunities that companies everywhere must face up to.

There’s so much information to take in and act on. Our weekly digest of articles, podcasts and videos can help you with your ESG education, as well as signing up for one of our Designation or Certificate programs

1. Loving the green. American Express has ramped up its green game. It unveiled its first US$1 billion ESG Bond last week, the proceeds of which will go towards green and social projects as part of its larger American Express Sustainability Financing Network. Projects under consideration will include affordable housing, socioeconomic advancement, green buildings and renewable energy. American Express has already also committed to a US$1 billion DEI Action Plan and net-zero carbon emissions by 2035.

2. We built this city. The European Commission announced last week a list of 100 European cities that are planning to be climate-neutral and smart by 2030. The Cities Mission is part of the broader research and innovations program Horizons Europe. The project kicks off with €360 million in funding for 2022-23. Clean mobility, energy efficiency and green urban planning top the priority list for the 100 selected cities, which include Paris, Lisbon, Munich, Milan, Barcelona, Amsterdam, Gothenburg and (of course) Brussels. Due to Brexit, the UK is a notable absentee from the initiative.

3. Mixed messages. HSBC faces accusations of greenwashing in the UK over some of its latest advertising campaigns. The Advertising Standards Authority (ASA), which regulates the industry in Britain, is looking at claims that the banking giant misled customers about its impact on climate change. HSBC had boasted to customers that it would provide US$1 trillion in financing to clients for the net-zero transition and plant two million trees. However, the ASA noted that HSBC’s annual report disclosed that the bank’s financed emissions were the equivalent of 35.8 million tonnes of carbon dioxide, which is incongruous with the bank’s green claims. 

4. Dodgy disclosures. The SEC bared its teeth on ESG again last week and charged Brazilian mining company Vale S.A., which is one of the world’s biggest iron-ore producers, with making “false and misleading claims about the safety of its dams”. These claims were made before the Brumadinho dam collapsed in January 2019, killing 270 people as well as causing devastating environmental and social damage. “Many investors rely on ESG disclosures like those contained in Vale’s annual Sustainability Reports and other public filings to make informed investment decisions,” said Gurbir S. Grewal, Director of the SEC’s Division of Enforcement in a news release. “By allegedly manipulating those disclosures, Vale compounded the social and environmental harm caused by the Brumadinho dam’s tragic collapse and undermined investors’ ability to evaluate the risks posed by Vale’s securities.” It is likely we will see more of these disclosures and cases as formal ESG standards are set worldwide by organizations such as the International Sustainability Standards Board.

5. Hot doc. “The Power of Big Oil,” a new three-part documentary series, shines a bright light into the recesses of the fossil-fuel industry. The documentary claims that many of the oil giants have lied and obusfacted about climate change for decades, thereby putting our planet in increasing jeopardy. The series has three episodes — Denial, Doubt, Delay — that aim to show, piece by piece, how easy it was to fool American politicians and the public. The series is currently on PBS Frontline and will be televised by the BBC in the summer. 

Mathew Loup is Competent Boards’ Director, Marketing & Communications. Connect with him on LinkedIn.

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