Next Finance English Flag Drapeau Francais
Jobs Training Search

Investors representing $1.6trn in assets renew calls for improved ESG reporting by listed companies

In a move led by Aviva Investors, Some 24 institutional investors have written to 30 stock exchanges across the globe...

Article also available in : English EN | français FR

The 24 institutional investors [1] asked for sustainability reporting by listed companies.

The move is part of a broader collaborative engagement initiative launched by Aviva and facilitated by the UN-backed Principles for Responsible Investment (PRI) in 2008. It aims to encourage stock exchanges to consider how to improve the quality of sustainability reporting by the companies that list on their exchange. [2] ESG Based on Bloomberg data, the letter also ranks individual listing authorities on a sustainability league table that assesses the level of ESG reporting by listed companies

• On the top we have : Euronext Paris, Tokyo Stock Exchange, Helsinki, Euronext Amsterdam, Euronext Lisbonne et Borsa Italiana.
• At the bottom we have: Australian Stock Exchange, NASDAQ GS, Korea Exchange, Santiago Stock Exchange et Philippine Stock Exchange.

Aviva Investors is in favor of a listing requirement for companies to consider how responsible and sustainable their business model is, and put a forward-looking sustainability strategy to the vote at their AGM.

Aviva Investors London CEO Paul Abberley said: "Markets are driven by information. A lack of information as a result of limited or non-disclosure of ESG data makes it difficult for long-term investors such as us to assess the wider ESG risks and opportunities associated with a company. "We believe that stock exchanges can play a crucial role in helping to create more sustainable global capital markets because of their ability to directly influence and monitor the operations and strategy of companies seeking to access the equity markets. This can only be a good thing for investors."

Georg Kell, executive director, UN Global Compact, a key supporter of the initiative, adds, “Many global companies understand that long-term shareholder value is enhanced by both embedding sustainability into their long-term strategy and by disclosing fully their progress. Only when investors have business-relevant information at their fingertips, will they be able to assess one company relative to its peers and allocate capital accordingly. Stock exchanges now have a significant role to play in taking obvious and important next steps to create truly sustainable capital markets.”

James Zhan, director division on investment and enterprise, UNCTAD (UN Conference on Trade and Development), the organizer of last year’s sustainable stock exchange event at the UNCTAD World Investment Forum in, notes, “Good quality ESG reporting among large companies is not uncommon, but the information being reported lacks comparability and usefulness. This investor initiative demonstrates the strong market demand for standardized ESG reporting and greater attention to sustainable development. Stock exchanges can play an important role in mainstreaming best practices nationally, and contributing to international efforts to harmonize ESG disclosure.”

Next Finance February 2011

Article also available in : English EN | français FR


[1] The 24 investors represent $1.6trn in assets and include the following (plus four service providers) :
Allianz Global Investors Investments Europe, AP7, Australian Council of Super Investors, Aviva Investors, BC Investment Management Corporation (bcIMC), Church of Sweden, Dexia Asset Management, Environment Agency Active Pension Fund, EQAO, Ethos Foundation, Fonds de réserve pour les retraites - FRR, Mn Services N.V., NEI Investments, North East Scotland Pension Fund, Pax World Management LLC, RCM une entreprise du groupe Allianz Global Investors, SNS Asset Management, Solaris Investment Management, Sparinvest, "TD Asset Management (TD Asset Management Inc., TDAM USA Inc.)", The Co-operative Asset Management, Trillium Asset Management, Triodos Investment Management B.V. et VIP (Vereinigung Institutionelle Privatanleger) eV. The four service providers are : Ceres, Ethix SRI Advisors, Fondation Guilé et Illac Ltd.

[2] The main purpose of the proposed corporate responsibility reporting requirement - and the associated AGM vote - is to create the right kind of discussions within the boardrooms of listed companies around the world, and then between the company and its shareholders.. The proposal suggests the UN Global Compact as an appropriate framework for boards to consider, and that reporting be conducted on a “comply or explain” basis. The three key components to the mechanics of the AGM vote itself are: (i) the report would be published in its entirety or summarised in the Report and Accounts; (ii) the vote would be advisory; and, (iii) shareholders will be asked to approve the report.



Facebook Facebook Twitter Twitter Viadeo Viadeo LinkedIn LinkedIn

In the same section