Written by Anthony Walters – Clever‘s Head of ESG, ESG in 5 is a roundup of 5 key pieces of ESG news and performance, from the past week.
The MSCI ACWI ESG Focus Index was slightly down for the week with a -1.53% return, against the MSCI ACWI Index return of -1.51%. The ESG Index has 30% exposure to Information technology and Communication services, with 61% of the index allocated to the United States and Apple, Microsoft, Nvidia and Amazon as its largest holdings.
Colgate-Palmolive Signs Renewable Energy Deal to Cover 100% of its U.S. Electricity Needs
Colgate-Palmolive has signed a 20-year virtual power purchase agreement (VPPA) with developers of a solar energy farm near Waco, Texas. This solar farm will meet 100% of the company’s electricity needs in the US. The Markum Solar Farm, a project by Scout Clean Energy and owned by Brookfield Asset Management, is expected to generate 209 megawatts of power.
Asset managers to begin reporting on nature-related risks
The Taskforce on Nature-related Financial Disclosures (TNFD) has released its final recommendations for companies and asset managers to report on and manage nature-related risks. This includes disclosing governance of nature-related dependencies, impacts risks, and opportunities; assessing and monitoring nature-related risks; and using metrics and targets to manage such risks.
Mercedes-Benz Signs Deal to Buy More than 50,000 Tonnes of Low Carbon Steel Annually for U.S. Production
This complements their plan to source 200,000 tonnes of CO2-reduced steel per year from European suppliers. The Alabama plant is expected to start using the environmentally-friendly steel this month. Mercedes-Benz aims to achieve a green steel supply chain by 2039 and reduce CO2 emissions from production by 80% by 2030.
Article 8 and 9 labels could be scrapped in upcoming SFDR consultation
The European Commission will consult on potentially removing the Article 8 and 9 labels under its SFDR regime. They aim to improve the integration of SFDR with other components of the sustainable finance framework. The commission will seek views on developing a more precise categorisation system instead of using the current disclosure labels.
What are article 8 and 9 labels?
An Article 8 classification promotes environmental or social characteristics, while Article 9 has a sustainable investment objective.
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Sources.
Anthony Walters – Head of ESG at Clever Adviser Technology Ltd (Clever)
Market recap – Data sourced from FE FundInfo & Koyfin (quoted in Pounds Sterling).
News – Colgate-Palmolive Signs Renewable Energy Deal to Cover 100% of its U.S. Electricity Needs by Susan Lahey, 19/09/23
Asset managers to begin reporting on nature-related risks, By Cristian Angeloni, Investment Week, 19/09/23
Mercedes-Benz Signs Deal to Buy More than 50,000 Tonnes of Low Carbon Steel Annually for U.S. Production, by Mark Segal, ESG Today, 18/09/23
Article 8 and 9 labels could be scrapped in upcoming SFDR consultation – reports, by Elliot Gulliver-Needham, 14/09/23 Label definition source: Invesco’s evolving fund range for sustainable investing – Article 8 and 9 funds, 04/07/23
Risk Warning: These are Anthony’s views at the time of writing and should not be construed as investment advice. The opinions expressed are correct at time of writing and may be subject to change. Capital is at risk. The value and income from investments can go down as well as up and are not guaranteed. An investor may get back significantly less than they invest. Past performance is not a reliable indicator of current or future performance and should not be the sole factor considered when selecting funds.
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