In the last week there was a number of articles related to pressure for financial institutions relative to a variety of sustainability goals. The greatest step back was the decision by the EU to delay its deadline to implement anti-greenwashing rules for investment managers. This delay was sought by fund managers that did not feel they could comply with the rule given some of its complexity. As reported in the Financial Times, the framework would still be in place from March 2021 but there would be a delay in the reporting requirements. So maybe it was only a half step back but nevertheless not going in the right direction.
On the other hand there were numerous stories (five of which I came across) that suggest the pressure on all financial institutions and other companies to be more sustainable is only growing. Of interest is that these are increasingly focused on the financing provided to companies and projects that are not addressing issues of climate change.
- The Financial Times reported that several investors were pressuring Samsung’s insurance units regarding their financing of climate change negative projects and companies.
- Then the new head of the Norwegian oil fund noted also in the Financial Times that they would be carefully looking at ESG criteria when making investments.
- Perhaps reacting to pressure on the disconnect between their practices and the words of their CEO, BlackRock is requesting at the annual general meeting that AGL (an Australian power company) speed up closing its coal-fired power plants.
- Next up was an opinion piece in the New York Times from heirs to the Rockefeller fortune (made in oil and gas I would note) stating that “JPMorgan Chase and other big banks should use their lending power to force cuts in greenhouse gas emissions.”
- And finally came HSBC with a commitment to be fully carbon neutral in its financing activities by 2050 as reported in the Financial Times.
So whilst the news is not always about progress and the timing could be considered too slow (looking at you HSBC), the trend is clear. ESG and climate change are topics where financial institution and companies will be pressured by investors to improve their work.
