Sustainability Briefs

Existing company disclosure practices provide the foundation to implement the TCFD’s recommendations Precedent in oil & gas shows reporting at the level of the four principles (governance, strategy, risk, metrics) can be done. Reporting on the 11 specific recommendations will be more challenging, however, none of these are impossible to meet. Climate change is a systemic issue and investors need system-level data. Which means data from all listed companies and eventually the large private ones.

What if companies were able to communicate—in clear financial terms—the total value they create for society? While still very much in a nascent stage, such attempts at total impact valuation are being piloted by more than a dozen major companies across an array of sectors and geographies. A new report finds significant promise in these approaches, but a range of challenges remain to be tackled. Above all, standards for definitions and methodologies are needed to facilitate meaningful comparison.

China’s new Environmental Protection Tax Law (EPT Law) came into effect on January 1. It replaces the old Pollutant Discharge Fees System. Taxation could increase, as more headroom for localities allows to set higher tax rates. Some leveling of the playing field is possible, as non-compliance and tax evasion are addressed. Supply chain costs may be impacted.

Increasing recognition of the impact of environmental, social and governance (ESG) risks and opportunities on portfolio value is driving institutional investors engagement with companies on ESG.

Last winter’s air pollution control plan in the larger Beijing area was unprecedented both in scale and intensity. The action plan was part of a much broader, central government-led effort to tackle China’s pervasive air pollution problem and significantly ramp up environmental protection efforts in general. It is highly unlikely at this point that the government will backtrack on this issue, given the long-term economic and political ramifications of doing so.

Science Based Targets (SBTs) for greenhouse gas (GHG) reduction are increasingly being discussed, however what they entail in detail is often not well understood.In contrast to a simple incremental approach, targets are considered ‘science-based’, if they aim at carbon reduction in accordance with the internationally agreed global climate change targets. In this blog, we want to give a very brief overview of the approach and its application.

This month the EU parliament approved a provisional agreement revising six pieces of EU legislation on waste. The legislation is part of the EU’s Circular Economy Package, a policy initiative aimed at advancing the practice of “recycle, repair and re-use” and waste avoidance. A new report provides more details on these and other recent developments related to the EU Circular Economy Package, including some of the key implications for companies.

An increasing number of studies point towards a strong positive correlation between ESG and financial performance. Whilst this has contributed to an increase in responsible investing, one of the implications of this has been the growth in the ESG rating and rankings initiatives.