ESG News in Brief (26/11/2022 - 3/12/2022)

  Briefing

A joint study between international insurance broker, Howden and leading specialty insurer and reinsurer, Fidelis, shows that higher ESG ratings lead to better underwriting performance.

howden-group-logoThe study of loss ratios across 30,000 policies from both Howden and Fidelis’ datasets, comprising a premium value of around $9 billion against third party ESG ratings, is the largest study that has ever been conducted to date to establish the link between these factors.

2

A recent Aon report has highlighted how using a captive insurance company can drive positive ESG outcomes, alongside how the UN Environment Program’s Principles for Sustainable Insurance can aid captive owners to address ESG risks and opportunities.

The PSI serve as a global framework for the insurance industry to address ESG risks and opportunities—and a global initiative to strengthen the insurance industry’s contribution as risk managers, insurers and investors to building resilient, inclusive and sustainable communities and economies on a healthy planet.

3

Morningstar Sustainalytics, a leading global provider of ESG research, ratings, and data, announced an expansion of its ESG Risk Ratings coverage to enable material ESG risk assessment across more asset classes and regions.

4

ESG data and reporting platform provider Figbytes announced that it has secured $14.5 million in financing, including $10 million in funding from existing investor Quantum Innovation Fund, and a $4.5 million debt facility from Silicon Valley Bank.

Ottawa-based FigBytes helps organizations to plan, track and report ESG goals through its ESG Insight Platform.

The SaaS-based platform enables organizations to easily and cost-effectively manage, track and report on ESG goals through solutions including carbon accounting, water stewardship, philanthropy, and diversity, equity and inclusion.

The National Development and Reform Commission's "Opinions on Further Improving the Policy Environment and Strengthening Support for the Development of Private Investment" first proposed to carry out ESG evaluation of investment projects

On October 28, 2022, the National Development and Reform Commission issued the "Opinions on Further Improving the Policy Environment and Strengthening Support for the Development of Private Investment". For the first time, the document proposes to explore the environmental, social and governance evaluation of investment projects, and guide private investment to pay more attention to the optimization of environmental impact, social responsibility, and the improvement of governance mechanisms. Some commentators said that carrying out ESG evaluation of investment projects is not only an active attempt to standardize international rules, but also an enrichment and extension of global ESG evaluation practices. It is of great significance to build an investment and financing governance system with Chinese characteristics and help realize Chinese-style modernization.

Dong Zhanfeng, Ministry of Ecology and Environment: To improve the level of enterprise's ESG credibility, it is necessary to integrate ESG into the company's development strategy

At present, the ESG report of A-share market is still mainly voluntary disclosure of listed companies, but with the increasing attention of regulatory authorities, the future ESG information disclosure of listed companies may face higher requirements. How to give consideration to social responsibility and corporate benefits in ESG transformation? How can SMEs cope with ESG challenges? Dong Zhanfeng, director of the Policy Institute of the Environmental Planning Institute of the Ministry of Ecology and Environment, said recently in an interview with the Shell Finance reporter of the Beijing News that improving the level of enterprise ESG information disclosure requires enterprises to integrate ESG into the company's development strategy, and take the preparation of ESG information disclosure reports as the main measure to build the enterprise's modern green governance capacity. Dong Zhanfeng also put forward four suggestions on how to build an ESG evaluation system with Chinese characteristics: first, we should fully reflect the requirements of pollution reduction and carbon reduction in the new development stage, and accelerate the construction of an ESG institutional framework highlighting green and low-carbon development. Third, focus on solving the problems of lacking top-level design, inconsistent evaluation standards and insufficient information in ESG evaluation. The fourth is to actively develop and cultivate local ESG rating agencies, strengthen the credibility of domestic investment institutions for domestic ESG ratings, and enhance the guiding role.

EXCHANGE PUBLISHES FINDINGS OF ITS LATEST REVIEW OF ISSUERS’ ESG DISCLOSURES

The Stock Exchange of Hong Kong Limited (the Exchange), a wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited (HKEX), today (Friday) published the findings of its latest review of issuers’ environmental, social and governance (ESG) disclosures (Report).

We are pleased to note that the 2020 Enhancements have helped drive positive change in the market, and we hope that the recommendations and guidance set out in the Report will lead to enhanced ESG stewardship in the months and years ahead,” said Bonnie Y Chan, HKEX Head of Listing.

Board governance of ESG issues – Monitoring the progress against ESG targets is key to the board’s evaluation of the effectiveness of the measures taken.

Hong Kong-listed firms ‘strongly’ advised to prepare for ISSB climate-disclosure demands, bourse operator says

Hong Kong listed firms are “strongly” advised to get ahead of the curve on an impending expansion of required climate disclosures, even as the vast majority have met strengthened reporting requirements imposed in 2020, the city’s bourse operator said.

Many Hong Kong listed firms, especially smaller ones, are far from ready to have reliable data to meet the Scope 3 and climate scenario analysis requirements, said Elsa Pau, founder of BlueOnion, which runs a portal that tracks sustainability data for companies and funds.

HKEX CEO Nicolas Aguzin on the future of Hong Kong’s capital market Since much of the Scope 3 data must be sourced from suppliers, many of which are small companies, most Hong Kong-listed firms have been relying on external consultants to help estimate such emissions.

On November 23, the first National "Double Carbon" Strategy and ESG Summit Forum was successfully held. Participants in the forum studied and implemented the important spirit of "promoting carbon peaking and carbon neutrality" proposed in the report of the 20th National Congress of the Communist Party of China, and discussed in depth the theoretical research, practical application of ESG direction and the realization of the "double carbon" goal. In his speech, Sun Shuo, secretary of the Xicheng District Party Committee of Beijing, said that the current "double carbon" work has become an important part of the Chinese-style modernization strategic layout and a key path to promote sustainable development. ESG includes Environment, Social and Governance, sustainable development The concept is highly consistent with promoting the realization of the "double carbon" goal. Zhao Ai, executive vice president and secretary-general of the China Economic System Reform Research Association and former director of the Regional Opening Department of the National Development and Reform Commission, said in an online speech that the China Economic System Reform Research Association pays close attention to and attaches great importance to ESG issues, and puts ESG development in particular It is the reform and innovation of the ESG fund system and mechanism as an important research topic of the whole research association.

The ESG Professional Committee of the Shanghai Association of China held the first ESG theme salon: helping listed companies improve ESG management level

On November 24, the ESG Professional Committee of the China Association of Listed Companies held the first ESG-themed salon. The theme of the salon was "How Listed Companies Prepare ESG Reports". The meeting was presided over by Zhang Zheng, Secretary-General of the Committee Secretariat and Director of the Office of the Board of Directors of Sinopec. Huang Wensheng, chairman of the committee, vice president of Sinopec, and secretary of the board of directors, introduced that the ESG professional committee of the Shanghai Association of China focuses on the basic duties of "service, self-discipline, standardization, and improvement" and is committed to building a communication platform for members of the association to carry out ESG work and guide listing. The company fulfills its corporate mission and responsibility, promotes the formation of an ESG management system with Chinese characteristics and international recognition, and promotes the improvement of the quality of listed companies.