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GC Asia
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DBS sets the stage to cut thermal coal exposure
DBS Bank is aiming to reduce its thermal coal exposure to zero by 2039, joining a group of global investors and banks that have made similar commitments to tackle climate change.
16 Apr 2021 -
EU eyes separate gas law, leaves harmful bioenergy in Taxonomy
The European Commission is set to put forward a new solution to the intense battle over the EU's sustainable finance Taxonomy, between green finance supporters and EU member states that want to safeguard their plans to use gas, GlobalCapital has learned. This would appear to involve leaving gas out of the sustainable category of the Taxonomy, as environmentalists have demanded, and making a "separate legislative proposal" to deal with gas and nuclear power.
15 Apr 2021 -
Jefferies skewers bank ESG ratings for ignoring climate
Several European banks’ noses were put out of joint this week by research from Jefferies, which suggested a very different ranking of banks’ ESG characteristics from that investors usually get from rating providers. The study argued commercial ESG ratings on banks are not fit for purpose.
15 Apr 2021 -
SGS’s aggressive approach lands debut at fair value
SGS, the Swiss corporate testing and verification company, came out aggressively for its debut Eurobond on Wednesday, and was rewarded with a spread flat to fair value.
14 Apr 2021 -
Showing ESG rankings everywhere is good biz
ESG ratings are starting to appear in term sheets for high grade corporate bond issuers, regardless of whether or not the deal is a themed issuance. This is a sensible move and ought to have a positive impact on the curve for the issuer.
13 Apr 2021 -
ESG ratings importance growing as IG corporates line up
A slew of mandates hit Europe’s high grade corporate bond market on Monday, with issuers increasingly adding their ESG ratings to investor communications that cover their whole enterprise, even if the deal being marketed is not a designated socially responsible investment.
12 Apr 2021 -
UOB appoints new chief sustainability officer
Singapore’s UOB has appointed Eric Lim as its chief sustainability officer, a newly created position to support the bank’s focus on ESG, which got a fresh impetus this week with the sale of the lender’s first sustainability bond.
09 Apr 2021 -
CLOs can preserve investment flexibility despite growth of ESG limits
CLOs have 'by nature' a limited exposure to the industries commonly excluded under ESG criteria, meaning their investment flexibility will be preserved, despite the exclusions appearing in more and more deal documents. This bodes well for the growth of ESG screening in the US CLO market, which has lagged behind other markets, with only 10 deals so far featuring the language, according to Deutsche Bank.
07 Apr 2021 -
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Trump exit unleashes Financial Stability Board to act on climate
The G20’s Financial Stability Board is cranking up its action on climate change again now that Donald Trump is no longer US president. This will feed the hopes of some sustainable finance supporters who want the FSB to drive progress on issues including environmental accounting.
07 Apr 2021 -
Digesting Deliveroo: timing the likeliest cause of first day woes
The equity market — and beyond — has been puzzling over how Deliveroo, one of the most anticipated IPOs of the year, could have suffered so badly in trading on its first day on Wednesday. Some blamed ESG concerns about the working conditions of the firm's delivery riders, others the dual class-share structure but the simplest explanation was that Deliveroo came at the wrong end of an IPO market that was losing steam.
01 Apr 2021 -
ESG: the filter that lets everything through
Deliveroo and its shareholders raised £1.5bn this week. The IPO was a dog, priced at the bottom of its range and falling 20% on its debut. But it’s hard to feel sympathy for the investors.
31 Mar 2021 -
Pipeline in peril as Deliveroo disaster wrecks market for IPO hopefuls
The IPO market looked on in despair on Wednesday as Deliveroo, the UK food delivery company, began trading. The stock fell more than 20% in early trading and shell-shocked bankers fear that IPOs planned for after Easter may have to be put on hold. Sam Kerr reports.
31 Mar 2021 -
KNOC bond clashed with banks’ own climate policies, NGO charges
An environmental activist institute has argued that the bookrunners of a Korea National Oil Corp $700m bond priced on Tuesday are being inconsistent with their own climate policies, and might even be taking legal risks, because of the issuer's exposure to tar sands oil production in Canada.
30 Mar 2021 -
KNOC fires up first dollar bond of 2021
Korea National Oil Corp’s (KNOC) quasi-sovereign credentials helped drive demand for its $700m bond on Monday, its first international debt transaction of the year.
30 Mar 2021 -
Deliveroo ‘listens’ to IPO investors and shrinks valuation
Deliveroo, the UK food delivery company, has taken heed of investor fears of IPO congestion and has revised its the price range of its listing down to the bottom end of the range.
30 Mar 2021 -
Huge investor group adopts Net Zero goal
The financial markets’ stance on climate change has taken a stride forward as 43 asset managers with $23tr of assets including some of the biggest such as BlackRock and Vanguard have joined the Net Zero Asset Managers’ Initiative. A critical mass of investors is now committed to reducing carbon emissions in their portfolios to zero, meaning that companies can be in no doubt which way they have to go if they want to maximise their potential investor base.
29 Mar 2021 -
Political deals tarnish Taxonomy’s claim to science-based objectivity
The polite world of sustainable finance has collided with the ugly reality of politics in the past week, as open strife has broken out over the European Union’s sustainable finance legislation, especially the Taxonomy. Conservative and progressive elements are battling over a host of issues, above all whether gas power should ever be classed as sustainable, and the validity and even legality of the Taxonomy is being called into question.
25 Mar 2021 -
EU Parliament tries to fight dilution of SFDR
A leaked letter from the European Parliament, seen by GlobalCapital, shows the Parliament has joined in the debate about the Sustainable Finance Disclosure Regulation, which has been watered down to make life easier for institutional investors. The Parliament is calling for the rules to be strengthened, to help savers know which investments are green and ensure compliance does not become just a “tick box exercise”.
19 Mar 2021 -
Science-Based Targets questioned as Axa excludes RWE
The reliability of Science-Based Targets — one of the most promising systems for helping companies decarbonise — has been questioned after RWE, the German power company, was excluded by Axa, the French insurance group, for being too wedded to coal, despite having an approved SBT.
17 Mar 2021 -
Polluters: embrace ESG or lose funding choice
Investors have shunned carbon-intensive and sin sectors this month. The message is clear: if they want to raise capital, companies in dirty industries need to show they are making meaningful moves towards becoming socially and environmentally responsible.
16 Mar 2021 -
Sustainable finance gets real
Hundreds of things happened this week in sustainable finance. That’s normal now — it’s become a fizzing, global market which is ever-present. Anyone who predicted, say, four years ago that sustainable finance would take over the whole capital market probably feels the outcome has exceeded their expectations.
11 Mar 2021 -
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NZIF ‘a game changer’ says UK pension leader
This week 35 investors with $8.5tr of assets — many of them UK and Nordic pension funds — launched the Net Zero Investment Framework, a primer for investors wanting to decarbonise their portfolios. Faith Ward, chair of the Institutional Investors’ Group on Climate Change, answers some key questions for GlobalCapital about why the Framework is important and how it will be implemented.
11 Mar 2021 -
HSBC sharpens Net Zero policy after shareholder resolution
HSBC has agreed to tighten its policies on climate transition and coal funding, in response to a shareholder motion calling on it to phase out fossil fuel financing. The move underlines the power investors have to accelerate change on environmental and social issues using shareholder votes, and could raise the bar for other banks.
11 Mar 2021 -
Investors launch Net Zero framework with threat of divestment
The prospect of investors exerting real pressure on companies to reduce greenhouse gas emissions, including divesting from big polluters, came a step closer on Wednesday with the release of the Net Zero Investment Framework, a map to guide investors on the journey to carbon neutrality.
10 Mar 2021 -
Tesco shows investor power by moving fast on healthy food
Tesco, the UK supermarket chain, has reacted quickly by setting new targets to sell healthier food, less than a month after a group of shareholders filed a resolution calling for this — a sign of how sensitive companies are to having environmental, social and governance motions voted on at their annual general meetings.
08 Mar 2021 -
EM debt strains ‘contained’ but doubts linger on sustainability
Most debt repayment strains in emerging markets have been contained, according to the Institute of International Finance, but there are still concerns about the organisation of debt relief and debt sustainability.
08 Mar 2021 -
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Citi’s Fraser makes net zero pledge on first day
Jane Fraser, CEO of Citigroup, said on Monday — her first day in the post — that the bank was committing itself to net zero financed greenhouse gas emissions by 2050. It joins major banks such as Barclays, HSBC and Morgan Stanley in having made such a promise.
01 Mar 2021 -
NIB expands SRI bond investments
The Nordic Investment Bank has broadened its investments in the socially responsible bond market to include social, sustainability and sustainability-linked bonds from issuers in the bank’s member countries.
01 Mar 2021 -
Second AGM motion jabs Barclays on fossil fuel support
Barclays is to face a second shareholder resolution on its response to climate change at its annual general meeting in May, urging it to set more ambitious targets to phase out financing of fossil fuels.
26 Feb 2021 -
Banks and investors’ backing of fossil fuels clash with their climate pledges
Banks and investors’ claims to be acting on climate change appear to clash with the financing they still provide in the real economy, research showed this week — such as plans to increase fossil fuel production and consumption, even in the UK and France.
25 Feb 2021 -
Banks grow anxious over ECB’s ESG criteria
Senior bank finance and capital markets figures speculated this week about where the ECB would be most likely to throw its weight in its effort to boost the sustainability of its balance sheet. With a senior eurozone central banker having recently urged it to decarbonise its assets, banks are on high alert as they anticipate sweeping changes to asset purchase and repo terms, writes Bill Thornhill.
25 Feb 2021 -
Finance is fossilised
Look at any bank’s website or hear its CEO speak and you will get a torrent of virtuous words about climate change, sustainability and supporting clients on their journeys to net zero. The same goes for big investors, from BlackRock down, but the windows of their ivory towers are misted up with all the hot air being spouted.
25 Feb 2021 -
BlackRock and Amundi: climate actions to speak louder than words
BlackRock and Amundi, the largest asset managers in the US and Europe, have both published policies on how they intend to engage with companies about climate change. After widespread criticism, BlackRock has moved a long way towards a more proactive stance, but it is not clear yet that either firm is prepared to get really tough with high carbon emitters — especially in their passive portfolios.
25 Feb 2021 -
China policy and markets round-up: January consumer inflation dips, new bank loans hit record amount, Beijing sets sights on banks' green performance, reputational risk management
In this round-up, consumer inflation in China disappoints in January, lenders extend a record amount of new renminbi loans last month, and the banking and insurance regulator asks financial institutions to step up their reputational risk management.
19 Feb 2021 -
Bank CEOs join Prince Charles’s net zero bid
Working out how banks can take credible pathways towards net zero emissions will be top of the agenda for the A-list of the banking industry’s chief executives who have joined the Prince of Wales’ new Financial Services Task Force.
18 Feb 2021 -
Axa promotes two to lead responsible investing
Axa Investment Managers has reorganised its responsible investment team, after the departures of Matt Christensen and Yo Takatsuki in the past six months.
18 Feb 2021 -
Golden Ocean shows equity market open for oil industry
Golden Ocean Group, the Burmuda-registered oil and dry bulk shipping company, has completed a Nkr2.87bn ($338.5m) capital raising backed by Norwegian billionaire John Fredriksen.
18 Feb 2021 -
Heavy industry way off track on climate, warns TPI
The scope for investors to get behind decarbonising some of the most difficult industries was highlighted on Wednesday by a report showing that only 14% of leading heavy industrial companies are aligned with limiting global warming to 2°C by 2050.
17 Feb 2021 -
Grünenthal considers funding options after reports of scrapped leveraged debt sale
Grünenthal, the German pain relief medicine maker, has extended the maturities on €535m of term loan facilities, telling GlobalCapital it is open to various financing options, after a press report saying investors had shunned a new euro leveraged loan.
17 Feb 2021 -
Fashion needs to work harder to find green fit
H&M, the Swedish fashion company, has sold a sustainability-linked security for its debut outing in the bond markets. This is an encouraging step, but the fashion industry has a lot more work to do to clean up its look.
16 Feb 2021 -
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HSBC picks new sustainability chief
HSBC has appointed a group chief sustainability officer, Celine Herweijer, to lead its effort to fulfil its commitment to being a net zero carbon emissions bank by 2050.
16 Feb 2021 -
Czech arms firm preps local bond to take aim at Colt as EM FX supply grows
Česká zbrojovka Group (CZG), a Czech firearms company, has mandated banks to arrange a local currency bond, which investors say is a developing trend. The bond will contribute to CZG’s planned acquisition of US arms major Colt.
15 Feb 2021 -
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New face to lead HSBC sustainability as Klier quits
HSBC’s CEO Noel Quinn is expected to announce a new leader for its sustainability agenda soon, as Daniel Klier is leaving to join Arabesque, an asset manager and technology company.
12 Feb 2021 -
People news in brief
Chuka Umunna joins JP Morgan — Deloitte hires another FIG banker — JP Morgan AM appoints transition bond expert
11 Feb 2021 -
JP Morgan hires ex-politician Umunna for ESG position
Chuka Umunna has been appointed by JP Morgan to a newly created post of head of ESG for Europe, the Middle East and Africa.
10 Feb 2021 -
Regulators weaken green disclosure rules to please investors
European financial regulators have bowed to pressure from investment firms and their trade bodies, and look set to weaken the requirements of the Sustainable Finance Disclosure Regulation, a central part of the EU's Sustainable Finance Action Plan.
05 Feb 2021 -
Fossil-heavy issuers try to avoid being new tobacco
Companies with high carbon emissions are preparing for the risk that they could have to pay more to access capital markets, if investors and banks retreat from fossil fuel-heavy businesses, and even divest altogether — as Aviva has threatened to do. Some issuers will use investor relations drives and labelled financings, but ultimately they will have to find common ground with investors on how to transition to low carbon.
03 Feb 2021 -
Spotlight shifts to Natixis, SG on Ecuador oil finance as banks pull out
In a rare sign that environmental campaigners are having an impact on the financial industry, the burden of financing the Ecuadorian Amazon oil trade has shifted between banks in the past six months. But it is clear the banking industry is supporting the trade in more ways than have yet been uncovered.
28 Jan 2021 -
Adani Ports prices tight bond despite weight of mining ties
Adani Ports and Special Economic Zone managed to seal its $500m 10 year deal inside fair value on Tuesday, despite investor concerns about the company's environmental and social record.
27 Jan 2021 -
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BlackRock’s Fink backs net zero, leaves responsibility to clients
BlackRock wants to move a long way towards catching up with leading investors in its response to climate change, its CEO Larry Fink indicated in his annual letter to chief executives on Tuesday. BlackRock stopped short of setting a net zero carbon emissions target for its $8.7tr of assets under management, or committing to swift decarbonisation. But it did publish a ‘net zero commitment’ saying it would “support the goal of net zero emissions by 2050 or sooner”.
26 Jan 2021
