Investors propose disclosure on sustainability performance

A group of investors has proposed that in order to be listed on global stock exchanges, companies must tackle environmental and social issues in their annual financial reports.

The launch of a global sustainability listing standard would allow investors to compare companies based on their environmental, social and governance (ESG) performance, while also encouraging responsible investing.

Climate change, employee relations, diversification, governmental relations, human rights, environmental impact, product impact, supply chain and safety are the eight specific issues in which companies would be required to disclose.

According to Bloomberg, large investment houses including Blackrock, Rockefeller & Co, Pax World Management and F&C Management, alongside a list of others, have already discussed the development of a sustainability listing standard.

The group of investors are seeking feedback from additional investors on their consultation paper, which provides details of the proposed standard, by May 1. The final paper will then be submitted to stock exchanges for consideration in October at the World Federation of Exchanges annual meeting.

Financial information firm Dow Jones and sustainable investment specialists RobecoSAM recently developed a joint index aimed to measure the sustainability credentials of companies, called the Dow Jones Sustainability Emerging Markets Index.

Meanwhile, earlier this week, a group of investors asked for better disclosure on how US water companies were dealing with environmental challenges.

Further reading:

Dow Jones launches ‘first’ sustainability index for emerging markets

US water investors call for better disclosure on company threats

Responsible investors seeing ‘enormous potential’ of emerging markets

Stock exchanges announce commitment to sustainable investment

The Guide to Sustainable Investment 2013