Since 2002
Postings and Commentaries by Ron Robins
An emerging ‘greenium’? New research says green bonds cost governments less
“Amid an ESG backlash in some states, the finding could lead to more governments seeking an ESG-related label for bonds that will fund socially or environmentally sustainable projects.” [COMMENTARY] Another reason for governments to encourage ESG. Incidentally, the cost of capital for corporations is also less if they show good ESG credentials! An emerging ‘greenium’?…
Republican anti-ESG push complicates faith-based impact investing
“The House hearings and attorneys general letter, as well as hundreds of bills proposed in red-state legislatures, are part of increasingly coordinated campaigns to push back against the growing tide of ESG investing and principles around socially responsible investing — approaches long championed by religious institutions.” [COMMENTARY] Being anti-ESG does not seem compatible with the…
The Climate Pricing Gap
“Why the popularity of passive investing is making it harder for the market to price in climate risk/opportunity.” [COMMENTARY] Years ago long-term investors bought stocks directly according to what they thought were the stocks’ profit potential. Now they mostly invest in long-term passive funds. That difference means appropriate stock pricing doesn’t happen. Hence, pricing gaps…
Why ESG is hard to sell to many advisors
“The term [ESG] is used and misused to the extent that it has lost meaning — but it’s not going away, and it could be a mistake to ignore it.” [COMMENTARY] Right-wing advisors believe ESG is a means to advance an agenda of climate and societal change in which they don’t believe. Also, most of…
Busting Myths About ESG and Sustainable Investing
“‘Anti-ESG’ rhetoric on political campaign trails and cable news breeds misinformation and creates misunderstanding about the use of environmental, social and governance factors in business. This week we’re breaking down some of the most common myths we see out there about ESG and what it means for businesses and investors, with insight from Andrew Behar,…
SEC hits ESG funds with subpoenas
“The enforcement division of the Securities and Exchange Commission has issued formal requests, including subpoenas, to a number of investment firms over their sustainable investment advertising practices. This escalation shows the SEC’s heightened scrutiny on environmental, social and governance funds. A significant point of concern for the SEC includes mainstream investment funds transitioning into ESG-focused…
Sustainability in the spotlight: Has ESG lost momentum in the boardroom?
“Whether or not the acronym ESG survives, the importance of governance and the nature of an organization’s environmental and social impact will continue to be key considerations for boards of directors and investors alike” [COMMENTARY] This is a terrific report providing great insights into how company boards currently perceive and act on ESG issues. The…
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Using green credit policy to bring down inflation: what central bankers can learn from history
“Central banks can design green credit policy instruments to potentially bring down inflation while also making allocative choices in support of the low-carbon transition. This paper draws on examples of policy made at the German Bundesbank and other central banks which sought to protect some sectors during a tightening cycle in ways that are compatible…
S&P ditches ESG debt rating scores amid criticism
“S&P Global will no longer give scores to corporate borrowers on ESG factors, amid criticism from political groups and questions about their usefulness. Since 2021 the debt rating agency has used a scoring system of one to five to denote a company’s ESG-related risk. Five is the lowest grade exposure, one is the highest. However,…
Green and social bonds ‘not more risky’ than conventional bonds
“The credit risk of a GSS bond is identical to that of a conventional bond from the same issuer, and so tends to carry the same credit ratings, according to Sascha Stallberg, who runs a green bond fund at Nordea.” [COMMENTARY] Though this is one issuer commenting, it’s probably true generally. It augurs well for…
The incredible shrinking climate ambitions of the world’s largest asset managers
“InfluenceMap says the number of asset managers carrying out ‘truly ambitious and effective climate stewardship practices’ has shrunk by 45% since 2021.” [COMMENTARY] This is not hard to understand in light of the massive wave of anti-ESG activity being undertaken. Note that the worst ‘back-trackers’ are huge US asset managers. The incredible shrinking climate ambitions…
BlackRock, State Street scramble to manage greenwashing risk
“The Financial Services Council held an urgent phone hookup with members this week to discuss their vulnerability to prosecution for misleading and deceptive conduct, similar to that brought against a Vanguard bond ETF by the Australian Securities and Investments Commission.” [COMMENTARY] If not settled, using terms such as ‘green’ bonds — green or sustainable anything…
Greenwashing lessons for investment managers
“Legislation and guidelines set by the EU in respect of ESG, like the Corporate Sustainability Reporting Directive (CSRD), the Taxonomy Regulation and the Sustainable Finance Disclosure Regulation (SFRD) are open to greenwashing risks.” [COMMENTARY] This article is useful reading for non-European investment managers as well. Greenwashing lessons for investment managers, Dr. Jan Saalfrank and Tom Loonen,…
It’s Not Just Wildfires and Hurricanes: Extreme Heat Is a Silent Killer for Companies
“Extreme heat could account for 65% of North America’s productivity losses by 2030, Sustainalytics says.” [COMMENTARY] This research provides some fascinating insight into how the worsening climate could impact corporate profits. However, this article also provides some understanding as to how companies can alleviate these climate-related costs to improve their profitability. It’s Not Just Wildfires…
India to emerge as global renewable energy powerhouse with fastest growing capacity
“India is poised to establish itself as one of the largest solar module manufacturers in the world and is witnessing the fastest growing capacity in renewable energy, said Raj Kumar Singh, Union minister of power and renewable energy.” [COMMENTARY] Could India replace China as a source of solar cell manufacturing? That would certainly please many…
The Green Gold Rush: Rising Investments in Geologic Hydrogen
“Recently, we reported on a discovery in France that unearthed a massive geologic natural hydrogen deposit in the Lorraine region, a find that could have substantial implications for the European Union’s decarbonization strategy. Amidst this backdrop, Denver-based startup Koloma is also making waves within the natural hydrogen energy sector, with all eyes on its innovative technology to identify, access,…
How ISSB standards boost corporate ESG strategies
“These new standards provide industry-specific factors and disclosure standards that are going to help companies as they adopt these standards. I think it’s going to help improve benchmarking across sectors and industries and help accelerate performance. If a new company is just starting to implement a sustainability programme, these standards are going to help them…
Hypocrisy penalty: Investors especially hate companies that say they’re good then behave badly – unless the money is good
“Stock investors punish companies caught doing something unethical a lot more when these businesses also have a record of portraying themselves as virtuous. This hypocrisy penalty is the main finding of a study we recently published in the Journal of Management.” [COMMENTARY] The results of this study make sense. Hypocrisy penalty: Investors especially hate companies…
2023 Sustainable Investment Survey
“Since the release of our last Sustainable Investment Survey report in October 2022, we have been busy with our sustainable investment research efforts. Using our proprietary Impact fund data set utilizing the Global Impact Investing Network’s (GIIN) IRIS+ taxonomy, we updated our reporting on fundraising trends in private Impact fund investing.[1] As a follow-up to 2022’s…
