Responsible Investing

  • Science-based targets could help banks wrestling with climate risk

    Science-based targets could help banks wrestling with climate risk

    UK banks and building societies are struggling with difficult aspects of incorporating climate change into their risk management, as demanded by the regulator, a PwC survey has found. The answer to some of their problems could be a non-risk initiative: science-based targets.

  • Banks: net zero in 2050 is not enough

    Banks: net zero in 2050 is not enough

    One by one, banks are taking responsibility to help fight climate change, by setting targets to eliminate carbon emissions from their whole financing portfolios by 2050. This will not suffice. Banks must learn a new way of interacting with clients.

  • HSBC financed climate laggards weeks before net zero target

    HSBC financed climate laggards weeks before net zero target

    HSBC provided $1.8bn of financing to high carbon companies including Kepco, which is developing new coal plants, in just five deals in the past four months, as it prepared to announce its “net zero ambition” on October 9, an NGO has alleged.

  • Post-Covid world will demand ‘new more humane’ capitalism

    Post-Covid world will demand ‘new more humane’ capitalism

    While most financiers are focused on dealing with the immediate impact of the pandemic, critics of capitalism are focused on the world after Covid and are determined that wealthy tackle inequality, financial support for the poor, and Earth’s worsening climate.

  • Central banks and climate change: Lagarde becomes leader

    Central banks and climate change: Lagarde becomes leader

    Long used to scanning the horizon for risks, central banks have belatedly woken up to the biggest one of all — climate change. Monetary policy has so far been ignored — but the European Central Bank, until now on the fringes of this issue, is plunging in

  • Sustainability disclosures delayed as regulators admit legal clash

    Sustainability disclosures delayed as regulators admit legal clash

    The European Commission has bowed to lobbying by investors and delayed compelling them to follow the detailed requirements of the Sustainable Finance Disclosure Regulation — a complex reporting task that is ill-matched with another EU rule, the Taxonomy of Sustainable Economic Activities.

  • Eurex accommodates new strategies with new ESG line

    Eurex accommodates new strategies with new ESG line

    Greater ESG sophistication is coming to the listed derivatives market, with Eurex Exchange announcing on Wednesday that it intends to launch new contracts that apply a new methodology for ESG exposure.

  • Meet the Platform: EU green finance watchdog

    Meet the Platform: EU green finance watchdog

    The European Union’s formation of its Platform on Sustainable Finance last week marks a new phase in responsible investing. Over the past four years or so, the most influential thinkers in the market, such as the Principles for Responsible Investing, have been quietly moving back to an older interpretation of what RI means: considering the effects of investment choices on others.

  • Bold banks to set first Science-Based Targets

    Bold banks to set first Science-Based Targets

    The long-awaited Science-Based Targets standard for financial institutions has arrived. It is one of the most ambitious attempts so far to wrest the financial sector from its path towards climate destruction.

  • ECB to look at green TLTROs

    ECB to look at green TLTROs

    The European Central Bank is considering a proposal to use its Targeted Longer-Term Refinancing Operations (TLTROs) to incentivise green lending. It has said it may also exclude so-called brown bonds from its asset purchase programmes.

  • Bondholders split on Zambia debt breather

    Bondholders split on Zambia debt breather

    Zambia’s request to defer payment on $3bn of its Eurobonds is the first potential default by an African government during the coronavirus crisis. The process has been poorly managed, say sources close to the matter, throwing into doubt Zambia's chances of winning leniency, the vital first step to avoiding a messy hard default. Mariam Meskin reports.

  • People moves in brief

    People moves in brief

    Goldman gives new positions to Marsh, Verri and Sorrell — Bain picks ESG boss — Falth turns up at Mizuho

  • ESG innovation blooms as market pushes for growth spurt

    ESG innovation blooms as market pushes for growth spurt

    ESG derivatives have been on the development fast track this year as product creation has swept from equity referencing contracts through to other asset classes. Ross Lancaster reports on the next steps the market must take to reach maturity.

  • Covid known unknowns, ESG vs. S&P, Suganomics

    Covid known unknowns, ESG vs. S&P, Suganomics

    This week in Keeping Tabs: what scientists still don't know about coronavirus as we grapple with a second wave, ESG index funds outperformed in the first half of the year, and Japan's currency challenge.

  • ESG harmonisation push gives cheer for derivatives

    ESG harmonisation push gives cheer for derivatives

    A push towards harmonising data and reporting standards in ESG finance is gaining momentum and is a much-needed move in the development of the market. This was the message from panellists at GlobalCapital’s Sustainable and Responsible Investment Capital Markets Virtual Forum this week.

  • Taxonomy opens up host of questions

    Taxonomy opens up host of questions

    Market participants are still speculating about exactly how the EU's Taxonomy of Sustainable Economic Activities will shape sustainable finance.

  • M&G’s ESG head to join Citi

    M&G’s ESG head to join Citi

    Anita McBain, head of responsible investment and environmental and social governance at M&G Investments, is joining Citi as head of ESG research for Europe, the Middle East and Africa.

  • Home Reit prepares £250m IPO

    Home Reit prepares £250m IPO

    Home Reit, a new real estate investment trust focused on homeless accommodation, is preparing to raise £250m via an IPO on the London Stock Exchange.

  • IMF drives Ecuador rally as debt swap settles

    IMF drives Ecuador rally as debt swap settles

    An IMF agreement that surpassed all expectations triggered a rally in Ecuador’s exchange bonds after they went free to trade this week, although analysts warn that February’s presidential election represents a major event risk.

  • Norilsk goes for dollars but spill scandal concerns remain

    Norilsk goes for dollars but spill scandal concerns remain

    Norilsk Nickel, the Russian metal and mining company which has found itself under heightened scrutiny in recent months after a series of major oil spills, is set to raise a dollar denominated benchmark bond this week. Russian telecom major Veon was also in the market for its second rouble offering in recent months.

  • Big groups join in new drive to clear ESG roadblocks

    Big groups join in new drive to clear ESG roadblocks

    Two of the biggest sustainable finance organisations, the PRI representing investors and WBCSD for companies, are putting their heads together to try to solve two of the thorniest issues impeding progress in the field.

  • Don’t let activist hedge funds trample ESG’s roses

    Don’t let activist hedge funds trample ESG’s roses

    If investors were a family, the activist hedge fund would be the brattish 20-something rich kid with libertarian opinions who relishes annoying everyone else. You wouldn’t expect this character to get on with the woke, vegan responsible investor who loves to hold forth on moral values.

  • Activist hedge funds prefer to fight ESG stars

    Activist hedge funds prefer to fight ESG stars

    Evidence is building that two of the biggest trends in investing — activism and environmental, social and governance awareness — are actually in conflict. Activist hedge funds not only worsen companies’ ESG performance, a study suggests, but seek out companies with high ESG values for attack.

  • ETFs take growing share of the ESG asset pie

    ETFs take growing share of the ESG asset pie

    The use of exchange-traded funds labelled as addressing environmental, social and governance themes is rising rapidly, as investors believe they allow them to track ESG indices more easily and cheaply, without necessarily having to engage intensively with ESG matters.

  • ELFA tries to open levfin’s ESG blockage

    ELFA tries to open levfin’s ESG blockage

    The speed with which leveraged finance investors have embraced environmental, social and governance issues in the past 18 months has created an information impasse in the market, which the investors’ trade body is striving to ease.

  • ESG investors: be careful with supply chains

    ESG investors: be careful with supply chains

    Environmental, social and governance investors are taking an interest in companies' supply chains at last. It is important they do this in a sophisticated way and think deeply about the potential repercussions. Getting supply chains wrong could have devastating consequences.

  • ESG, Trump, Covid hasten re-shoring trend

    ESG, Trump, Covid hasten re-shoring trend

    Signs are growing that Western companies may be on the verge of a wave of moving manufacturing from China to other emerging markets and ‘re-shoring’ them to the home country, a trend that could have profound implications for markets and international politics.

  • Private debt buyers seek richer ESG analysis

    Private debt buyers seek richer ESG analysis

    Consciousness of environmental, social and governance factors is snowballing among private debt and equity investors, prompting them to seek new answers to the conundrum of how to obtain adequate ESG information on private companies. Providers are trying to meet the demand, including with innovative products.

  • Rep risk of sov restructuring is worth it for real money investors

    Rep risk of sov restructuring is worth it for real money investors

    Real money investors have historically avoided the reputational risk involved in participating in sovereign debt restructurings. But a truly socially responsible investor should embrace these situations — for the sake of both their clients and troubled emerging nations.

  • EU: the musical, Hong Kong: the swan song, and a menacing ballet

    EU: the musical, Hong Kong: the swan song, and a menacing ballet

    Each week Keeping Tabs beings you the most interesting and entertaining reading from around the web that we have uncovered. This week, the perils of the EU recovery fund through the lens of the subject of Broadway's hottest show, a menacing whiteness of swans and a grim view of Hong Kong's future in finance.

  • DoL proposal misses the mark on ESG

    DoL proposal misses the mark on ESG

    The US Department of Labour (DoL) has proposed what it characterises as a reiteration of what has always been required of retirement fiduciaries — that they act in the best interest of their beneficiaries — urging them to disregard ESG considerations in investment decisions. In doing so, it appears not to have noticed the last decade in financial markets, which has shown that ESG investing is very much in investors’ interests.

  • EM restructuring — spare us the posturing

    After striking a remarkably swift restructuring deal with creditors, Ecuador’s government deserves praise. But it is unrealistic to expect such smooth discussions elsewhere, as emerging market sovereign defaults inevitably rise.

  • EBA finally receives approval for exec director

    EBA finally receives approval for exec director

    François-Louis Michaud was approved as the next executive director of the European Banking Authority on Wednesday. The EBA’s previous choice was rejected by parliamentarians, and this nomination faced scrutiny too over gender balance.

  • Impact investor Durreen Shahnaz: ‘we must go beyond social bonds’

    Impact investor Durreen Shahnaz: ‘we must go beyond social bonds’

    Durreen Shahnaz is founder and chief executive of Impact Investment Exchange (IIX), which says it created the world's first social stock exchange. She tells GlobalCapital about how we can rebuild a better economy, with the help of capital markets, after coronavirus.

  • Global warming temperature scores to radically simplify green investing

    Global warming temperature scores to radically simplify green investing

    CDP, the leading platform through which companies report their carbon emissions, has become the latest organisation to launch a potentially influential system of temperature ratings, so investors can work out how much global warming each company’s plans will theoretically lead to — and hence the overall temperature of a portfolio.

  • Film director Richard Curtis: ‘the time for tinkering is coming to an end’

    Film director Richard Curtis: ‘the time for tinkering is coming to an end’

    If UK pension savers knew how their money was invested, funds would be more inclined to invest exclusively in environmental, social and governance (ESG) assets. So argues Richard Curtis, the screenwriter, director and co-founder of Comic Relief. He has launched a public campaign, Make My Money Matter, to pressure UK pension funds to invest more sustainably.

  • YPF swap not distressed but Argentina battles on

    YPF swap not distressed but Argentina battles on

    As tensions between Argentina and its largest bondholders climbed this week, the government’s prize asset, oil firm YPF, differentiated itself with a debt exchange that, according to rating agencies, does not punish creditors — unlike the sovereign’s proposals.