June 2022 Newsletter
News & Commentaries by Ron Robins
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Latest Podcasts:
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Latest Podcast: Ocean…s ETF. Fastest Growing Green Companies… Articles covered include: “Meet the 50 fastest-growing green companies in Canada”; “An ETF to Save the Oceans Splashes into the Market”; …Jim Cramer says he likes this alternative energy play for a high inflation environment”; “A Guide To ESG Strategies For Municipal Bond Investors”; and “2022’s Top Sustainable Funds Weather a Tough Market.” And more!
— By Ron Robins
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EU agrees deal on company disclosures to combat greenwashing. “The European Union has reached a deal on corporate sustainability reporting requirements for large companies from 2024, a European Parliament committee said on Tuesday. Regulators have grown more worried about companies engaging in greenwashing, or making exaggerated climate-friendly claims to attract investor cash.”
[COMMENTARY]One thing I particularly like is that disclosures will be externally audited by approved firms! This is something that’s been missing in ESG reporting since the beginning of such reporting. If the statements and numbers reported aren’t uniform among companies and independently verified what good is the reporting!
EU agrees deal on company disclosures to combat greenwashing, by Huw Jones, June 21, 2020, Reuters, UK.
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Low ranking ESG companies facing restricted lending. “Institutional owners are restricting lending of companies perceived as unsustainable, according to Travis Whitmore, senior quantitative researcher and head of securities finance research at State Street Associates.”
[COMMENTARY]This is another reason why ESG is growing fast. The ESG naysayers on the American right need an education on the profit imperative that ESG offers to companies when properly implemented. And that’s why high-ranking ESG companies find it easier to obtain funds.
It’s convenient to say ESG is a socialistic political policy but the truth is it is usually a means to enhance corporate profitability!
Low ranking ESG companies facing restricted lending, by Carmella Haswell, June 20, 2022, Securities Finance Times, UK.
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ESG Funds Supporting Mining’s Future. “Global law firm White & Case believes that ensuring that borrowers have taken appropriate ESG and sustainability considerations into account has become a priority for many mining investors as well as financiers across the spectrum — from export credit agencies, development finance institutions and commercial lenders, through to stream and royalty financiers.”
[COMMENTARY]The mining industry is increasingly engaging ESG not only to become more profitable but to also appeal to investors who hitherto have thought of mining as bad for the environment. The truth is there’s absolutely now way ANY of the world’s climate goals through electrification can be remotely achieved without vastly expanding mining capacities!
ESG Funds Supporting Mining’s Future, by Collin Sandell-Hay, June 20, 2022, The Assay, Hong Kong.
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Proposed ESG Disclosure Requirements for Investment Advisers and Investment Companies. “The proposal on ESG disclosures for investment advisers and registered investment companies would introduce requirements for advisers and registered funds that consider ESG factors in their investment processes to disclose more about those factors’ role in investment decisions.
The Names Rule proposal would extend the 80% investment policy requirement to registered funds with names that suggest the fund focuses on investments/issuers with particular ESG characteristics.”
[COMMENTARY]Though, in general, I welcome the thrust of these regulations I can’t help wondering if we’re going into ‘overkill’ though! My concern is that regulators create such regulatory tightness that it kills the creativity of the sustainability, and ESG, ethos. Plus, the extra costs incurred in conforming to the regulations become a penalty for advisors and investors vis-a-vis ‘conventional’ funds and investments.
Proposed ESG Disclosure Requirements for Investment Advisers and Investment Companies, by Laura Ferrell, Sarah Fortt, and Betty Huber, June 20, 2022, Harvard Law School Forum on Corporate Governance, USA.
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Launched—9 th edition of the Global Prize Ethics & Trust in Finance for a Sustainable Future. “By launching the 9th edition (2022/2023) of the Global Prize Ethics & Trust in Finance for a Sustainable Future online, we want to encourage candidates to reflect on the role of ethics in shaping a more sustainable and responsible financial system. Such intellectual effort is made today more necessary and urgent than ever.”
[COMMENTARY]I’ve helped publicize this prize since its inception as I believe inherently in its purpose! Please spread the word about it throughout your networks and encourage suitable candidates to participate.
Launched–9 th edition of the Global Prize Ethics & Trust in Finance for a Sustainable Future, press release, June 16, 2022, Switzerland.
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Millennials and Gen Z Are Fed Up With ESG Investing. “Ethically minded investors are growing more skeptical of ESG investing, wondering whether it actually furthers environmental or social justice aims. At the same time, demand for ethical investing is only going to increase as progressive millennials and Gen Zers accrue more financial assets, often by inheriting that money from their conservative parents.”
[COMMENTARY]The title of this article is too strong considering its content. However, I do think that many young ESG investors would like to see much greater action by companies, regulators, and governments, on ESG matters.
Millennials and Gen Z Are Fed Up With ESG Investing, by Tanja Hester, June 13, ThinkAdvisor, USA.
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Boards Are Tying Goals to ESG Metrics. “Our analysis of three data points on board oversight of ESG issues, covered under the Shareholders and Governance stakeholder, has led to two key findings. First, disclosure on these data points is steadily increasing.
Almost a fifth of companies in the Russell 1000 Index report all three ESG governance data points we measure in 2022-up from around a tenth in 2020. Second, the Oil & Gas, Utilities, Energy Equipment & Services, and Chemicals industries have a much larger percentage of companies disclosing on all three ESG governance data points than other industries.”
[COMMENTARY]The research shows that company boards are increasingly taking ESG considerations seriously. It shows that ESG enablement is becoming embedded in board activities.
Boards Are Tying Goals to ESG Metrics, by Molly Stutzman, Laura Thornton, and Matthew Nestler, JUST Capital, June 13, 2022, Harvard Law School Forum on Corporate Governance, USA.
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Featured Book
Your Essential Guide to Sustainable Investing: How to live your values and achieve your financial goals with ESG, SRI, and Impact Investing, by Larry E. Swedroe and Samuel C. Adams, Harriman House 2022.
“How can you find investments that truly reflect your principles? This excellent book will tell you. You’ll learn the nuances of social investing as well as discover your likely investment returns. Highly recommended!” –Jane Bryant Quinn, Author, How to Make Your Money Last: The Indispensable Retirement Guide.
