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Issue 18 - December 2013

Note from the Editor

Research into the effectiveness of ESG considerations on financial performance and responsible investing continues to be recognized and rewarded. In November, the PRI Academic Network hosted its annual conference in France, bringing together academics, investors, corporates and RI practitioners. Prizes were awarded for outstanding student and academic research in the area of responsible investing.

The Moskowitz Prize for Socially Responsible Investing was also awarded this fall to Dr. Caroline Flammer. Flammer’s win illustrates the ties between RI research and practice and how that relationship can move RI issues into boardrooms and onto Wall Street. Sustainability reporting initiatives are also helping this shift. The work of the Sustainable Stock Exchanges Initiative (SSE) encourages exchanges and regulators to require greater corporate transparency around material sustainability issues. Quantitative research, such as those recognized this fall, as well as corporate sustainability reporting initiatives, are helping to advance the merits of responsible investing by providing investors with a wealth of valuable information.  


 

Analysts' Insights

Tackling Corruption in Development Projects: World Bank Sanctions and Corporate Risk
by Dana Maria Pop

Dana Maria Pop

Ethical business practice continues to be a concern for many investors. As international development banks work together with greater frequency to debar companies ensnared in bribery and corruption cases, the implementation and execution of policies and programs to combat this behaviour is of the upmost importance. Analyst Dana Maria Pop makes the case for the integration of business ethics issues into a responsible investment policy.

Read more about the business risk of World Bank sanctions

COP 19 in Warsaw Overshadowed by Coal
by Lucas Schoeppner

Lucas Schoeppner

In a recent article for Triple Pundit, former Sustainalytics analyst Lucas Schoeppner recounts the events at COP19 in Warsaw, Poland. Coal and fossil fuel interests were heavily represented at the climate talks, to the dismay of many observers. Lucas also looks at the role coal continues to play in developing markets. 

Read more about COP 19


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Sustainalytics' Perspective

Webinars

Peter Albert, CEO of G-Resources, was the guest speaker for our most recent WEBinASIA presentation Mining in Asia: How to Manage ESG Risks. Mining companies, especially those with operations in emerging markets, face key environmental, social and governance risks such as water scarcity, health and safety issues, community relations and corruption. If left unmanaged, these issues could have a significant impact on a company’s bottom line. Peter discussed G-Resources’ exposure to these ESG-related risks as well as the company’s efforts to manage them.

Download the recording and slide deck.

Download our other webinar recordings at www. sustainalytics.com/webinars.

Report (Coming Soon)
Investor Outlook: Private Prisons and Immigration Detention Facilities

The poor conditions and mistreatment of inmates at private correction and immigration detention facilities continues to make headlines globally. Companies in this industry repeatedly find themselves embroiled in human rights and business ethics controversies, which poses potentially significant financial and reputational risks for investors. In this article, Sustainalytics’ analyst Alexander Read-Brown will outline the issues facing private prison operators and the risks they pose to investors.

Look for Investor Outlook: Private Prisons and Immigration Detention Facilities in early 2014.


New website encourages stakeholders to 'Know the Chain'

Know the Chain logo

Launched in October, the Know the Chain website was developed by a partnership of organizations committed to ending modern-day slavery. The website was conceptualized and developed by the Coalition to Abolish Slavery & Trafficking, Humanity United, Not for Sale, Sustainalytics, and Verité. Through the site shareholders, NGOs, and consumers can discover which companies meet the criteria established by the California Transparency in Supply Chains Act (SB-657). The site is also a resource to assist companies in responding to SB-657 and proactively addressing human rights violations in their supply chains.

Learn more at www.knowthechain.org.  


Inside Sustainalytics

Sustainable Stock Exchanges Initiative releases guidance 

Diederik Timmer (Sustainalytics), Danielle Cheseborough (UN Global Compact) & Doug Morrow (CK Capital)

Sustainalytics, along with other working group members, provided input for the Sustainable Stock Exchanges Initiative report Best practice guidance for policymakers and stock exchanges on sustainability reporting initiatives. The document provides guidance on the role of stock exchanges and regulators in advancing corporate sustainability reporting. To celebrate the report’s launch, representatives from the Sustainable Stock Exchanges Initiative rang the closing bell at the NASDAQ stock exchange in New York City. 

Read the full press release

ICCR report finds top U.S. banks ranks poorly on key shareholder concerns

Ranking the Banks: A survey of seven U.S. banks conducted by members of the ICCR and SustainalyticsIn November the Interfaith Center on Corporate Responsibility released its Ranking the Banks report assessing the performance of the top seven U.S. banks on issues of particular concern for investors. With research and analysis conducted by Sustainalytics, the benchmarking questionnaire aimed to gain insight into the status of the financial sector five years after the crisis. The banks were evaluated on four key shareholder concerns: executive compensation, risk management, responsible lending and investing, and political contributions. All of the banks scored a disappointing 60 or fewer points out of a possible 100 points. It is hoped that the information provided by the banks in this report will help guide investor engagement going forward. 

Download the full report from www.iccr.org.

PRI Academic Network Conference rewards RI research

On November 13-15 the PRI Academic Network Conference was held in Paris. Hosted by Caisse de Dépôt, the event saw academics and RI practitioners come together to share research and ideas on responsible investing. Sustainalytics was once again proud to sponsor the awards for student and academic research. Congratulations to the winners!

See the winning papers here.

Sustainalytics works with amLeague to assess manager's SRI performance

amLeague enables unbiased asset-managers performance comparisons through a "same level playing field" process. amLeague will launch its SRI European Equities Mandate on December 31st. Sustainalytics will work with amLeague to produce the environmental, social and governance indicators on which the asset managers will be measured. All ESG measurements produced will be displayed on the amLeague website. 

Learn more about amLeague's new mandate.

IN THIS ISSUE

Analysts' Insight

Sustainalytics' Perspective

Inside Sustainalytics

Events

Sustainalytics in the Media


MEET SUSTAINALYTICS IN YOUR REGION

February 4
PRI: Responsible Investment Advances in Fixed Income - London, UK

February 5
New Year's Drinks with UKSIF & Sustainalytics - London, UK

24-25 March
GRI Training - Vancouver, Canada

26-28 March
GLOBE Conference 2014 - Vancouver, Canada

Visit our website for a full listing of events. 

View upcoming events in the Toronto Sustainability Speakers Series.


IN THE MEDIA

Banks out to prove sustainability is a central pillar of their principles - EuroWeek  
The article examines how banks' strive to fulfill the role of responsible corporate citizen. The reporter also looks at banks' efforts to address their own institutional risk and sustainability.


TELL US WHAT YOU THINK

In a continuous effort to improve the overall quality of our newsletter, we would appreciate any feedback, ideas and/or suggestions from our readers. What would you like to see in upcoming newsletters? Share your views with us by sending an email to: 
communications@sustainalytics.com


ABOUT SUSTAINALYTICS

Sustainalytics is a global leader in sustainability research and analysis for investors and financial institutions, specialized in analyzing environmental, social and governance (ESG) criteria for companies, institutions and countries. We provide a global perspective, underpinned by over 20 years of local experience and expertise in the responsible investment and traditional socially responsible investment markets. The firm is headquartered in Amsterdam with local offices in Boston, Bucharest, Frankfurt, Paris, Singapore, Timisoara and Toronto; and with representatives in Bogota, Brussels, Copenhagen, London, New York City and San Francisco.