New report released claims the world’s largest companies are under-reporting sustainability policies and performance, hindering access to data that could allow investors to play a full role in the transition to a low-carbon economy.
The study, “Measuring sustainability Disclosure: Ranking the World’s Stock Exchanges 2016”, finds that of 4469 large companies analysed, only 47% disclosed GHGs, arguably the most closely tracked sustainability indicator. Furthermore, over the 2010-2014 period, the number of large companies that disclosed GHGs nudged up just 12 points from 33% to 47%, despite a number of high-profile policy initiatives aimed at sustainability disclosure in the last few years.
First commissioned by Aviva Plc in 2012 as part of the Sustainable Stock Exchange Initiative, the report tracks corporate disclosure on seven sustainability indicators – payroll, GHGs, energy, water, waste, injury rate and employee turnover. Written by Corporate Knights, it also suggests how such disclosure can be translated into actionable key performance indicators, which might help investors to distinguish companies that are incorporating sustainability into their value creation story.
Steve Waygood, Chief Responsible Investment Officer at Aviva Investors, said, “we go further than ever in this fifth annual report by looking beyond disclosure and into performance analysis. For each exchange, we assess carbon intensity, fossil fuel reserve intensity and the percentage of listed companies whose businesses involve environmentally-friendly activities, technologies and services versus high-carbon emission activities. This is a significant step forward that will empower investors to increase the integration of sustainability factors into investment decision making.”
The last year has seen significant milestones for sustainability, with the Paris Agreement on climate change and the subsequent Financial Stability Board (FSB) task force on climate-related disclosure, as well as the announcement of the Sustainable Development Goals (3). The task force will recommend climate-related financial risk disclosures later this year. These are encouraging developments, but with the majority of companies failing to provide sufficient transparency, there is a clear need for policymakers, securities regulators, investors and stock exchanges to take a more formal and proactive approach.
The report, which begins with a foreword by Aviva Group Chief Executive Mark Wilson, includes the following recommendations:
· Policymakers and securities regulators in both developed and emerging economies are encouraged to study the possibility of influencing investment returns based on the corporate sustainability of the securities issuer. For instance, dividends of issuers in the same sector could be taxed more highly or lowly depending on sustainability ratings.
· The more highly ranked stock exchanges have at least one mandatory, prescriptive requirement to regulate sustainability disclosure. It is recommended other jurisdictions consider this approach or convert existing voluntary policies into mandatory ones.
· Stock exchanges are encouraged to track and publicly report on listed entities that are engaging in sustainability disclosure and those that are not to put pressure on laggards.
Exchanges rising and falling
Euronext Amsterdam was the world’s best performing exchange when it came to disclosure of sustainability metrics. Over 50% of its large listings disclosed all four environmental metrics – GHGs, energy, water and waste. Stock exchanges in European developed countries dominated the top 10 rankings, with the exception of the Australian Securities Exchange and the Johannesburg Stock Exchange.
The London Stock Exchange, which placed eighth in the ranking, saw 95% of its large companies disclose GHGs. The UK’s 2013 update of the Companies Act made GHG disclosure mandatory for listed UK incorporated companies.
There was a general absence of progress among stock exchanges in the lower half of the ranking. Some 21 stock exchanges have been placed in the bottom half at least three consecutive times and remain there this year. Among emerging economies, The Stock Exchange of Thailand and Bursa Malaysia climbed sharply in the last two years, landing in 13th place and 17th place respectively, compared to 27th and 23rd place in 2014.
The full report is available http://www.corporateknights.com/reports/2016-world-stock-exchanges/
A Good Look At How Homes Will Become More Energy Efficient Soon
Everyone always talks about ways they can save energy at home, but the tactics are old school. They’re only tweaking the way they do things at the moment. Sealing holes in your home isn’t exactly the next scientific breakthrough we’ve been waiting for.
There is some good news because technology is progressing quickly. Some tactics might not be brand new, but they’re becoming more popular. Here are a few things you should expect to see in homes all around the country within a few years.
1. The Rise Of Smart Windows
When you look at a window right now it’s just a pane of glass. In the future they’ll be controlled by microprocessors and sensors. They’ll change depending on the specific weather conditions directly outside.
If the sun disappears the shade will automatically adjust to let in more light. The exact opposite will happen when it’s sunny. These energy efficient windows will save everyone a huge amount of money.
2. A Better Way To Cool Roofs
If you wanted to cool a roof down today you would coat it with a material full of specialized pigments. This would allow roofs to deflect the sun and they’d absorb less heat in the process too.
Soon we’ll see the same thing being done, but it will be four times more effective. Roofs will never get too hot again. Anyone with a large roof is going to see a sharp decrease in their energy bills.
3. Low-E Windows Taking Over
It’s a mystery why these aren’t already extremely popular, but things are starting to change. Read low-E window replacement reviews and you’ll see everyone loves them because they’re extremely effective.
They’ll keep heat outside in summer or inside in winter. People don’t even have to buy new windows to enjoy the technology. All they’ll need is a low-E film to place over their current ones.
4. Magnets Will Cool Fridges
Refrigerators haven’t changed much in a very long time. They’re still using a vapor compression process that wastes energy while harming the environment. It won’t be long until they’ll be cooled using magnets instead.
The magnetocaloric effect is going to revolutionize cold food storage. The fluid these fridges are going to use will be water-based, which means the environment can rest easy and energy bills will drop.
5. Improving Our Current LEDs
Everyone who spent a lot of money on energy must have been very happy when LEDs became mainstream. Incandescent light bulbs belong in museums today because the new tech cut costs by up to 85 percent.
That doesn’t mean someone isn’t always trying to improve on an already great invention. The amount of lumens LEDs produce per watt isn’t great, but we’ve already found a way to increase it by 25 percent.
Maybe Homes Will Look Different Too
Do you think we’ll come up with new styles of homes that will take off? Surely it’s not out of the question. Everything inside homes seems to be changing for the better with each passing year. It’s going to continue doing so thanks to amazing inventors.
ShutterStock – Stock photo ID: 613912244
IEMA Urge Government’s Industrial Strategy Skills Overhaul To Adopt A “Long View Approach”
IEMA, in response to the launch of the Government’s Industrial Strategy Green Paper, have welcomed the focus on technical skills and education to boost “competence and capability” of tomorrow’s workforce.
Policy experts at the world’s leading professional association of Environment and Sustainability professionals has today welcomed Prime Minister Teresa May’s confirmation that an overhaul of technical education and skills will form a central part of the Plan for Britain – but warns the strategy must be one for the long term.
Martin Baxter, Chief Policy Advisor at IEMA said this morning that the approach and predicted investment in building a stronger technical skills portfolio to boost the UK’s productivity and economic resilience is positive, and presents an opportunity to drive the UK’s skills profile and commitment to sustainability outside of the EU.
Commenting on the launch of the Government’s Industrial Strategy Green Paper, Baxter said today:
“Government must use the Industrial Strategy as an opportunity to accelerate the UK’s transition to a low-carbon, resource efficient economy – one that is flexible and agile and which gives a progressive outlook for the UK’s future outside the EU.
We welcome the focus on skills and education, as it is vital that tomorrow’s workforce has the competence and capability to innovate and compete globally in high-value manufacturing and leading technology.
There is a real opportunity with the Industrial Strategy, and forthcoming 25 year Environment Plan and Carbon Emissions Reduction Plan, to set long-term economic and environmental outcomes which set the conditions to unlock investment, enhance natural capital and provide employment and export opportunities for UK business.
We will ensure that the Environment and Sustainability profession makes a positive contribution in responding to the Green Paper.”
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