{"id":996,"date":"2012-03-29T10:33:42","date_gmt":"2012-03-29T10:33:42","guid":{"rendered":"https:\/\/earthsummit2012.stakeholderforum.org\/2012\/03\/29\/rio20-should-refine-integrated-reporting-proposal-investors\/"},"modified":"2012-03-29T10:33:42","modified_gmt":"2012-03-29T10:33:42","slug":"rio20-should-refine-integrated-reporting-proposal-investors","status":"publish","type":"post","link":"https:\/\/earthsummit2012.stakeholderforum.org\/index.php\/rio20-should-refine-integrated-reporting-proposal-investors\/","title":{"rendered":"Rio+20 should refine integrated reporting proposal \u2013 investors"},"content":{"rendered":"

Investors have welcomed a proposal to make companies report on their environmental and social impacts, to be discussed at the Rio+20 sustainable development summit in June, but say it could be improved in several ways.<\/span><\/p>\n

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The \u2018zero draft\u2019 of the text to be agreed by governments at Rio+20 includes a call for a global policy framework \u201crequiring all listed and large private companies to consider sustainability issues and to integrate sustainability information within the reporting cycle\u201d.<\/span><\/p>\n

Meanwhile, a High-level Panel on Global Sustainability, convened by UN Secretary-General Ban Ki-moon, recommends that governments consider making integrated reporting mandatory for corporations with market capitalisations of more than $100 million.<\/span><\/p>\n

Steve Waygood, chief responsible investment officer at Aviva Investors in London, told a meeting in the city last week, organised by the Stakeholder Forum for a Sustainable Future, that this is a \u201chuge step forward\u201d in communicating sustainability issues to investors.<\/span><\/p>\n

However, he insisted that there is no need for Rio+20 to create another framework. \u201cThere are plenty of reporting frameworks out there,\u201d he said, citing the Global Reporting Initiative, among others. \u201cThere\u2019s already sufficient technical guidance out there.\u201d<\/span><\/p>\n

Furthermore, the high-level panel\u2019s recommended minimum company size \u201cunintentionally misses large unlisted companies that do not have a market capitalisation\u201d.<\/span><\/p>\n

Waygood also urged governments to adopt a \u201ccomply or explain\u201d provision, so that companies either report to their shareholders on their sustainability issues, or explain why they choose not to.<\/span><\/p>\n

\u201cComply or explain has been very successful in the various markets it has been implemented within, most notably the UK\u2019s approach to corporate governance,\u201d he said.<\/span><\/p>\n

\u201cThis will provide corporations with the freedom to define their own reporting … it would be a mistake to attempt to create a one-size-fits-all approach to [key performance indicators] as this would preclude the need for boards to consider the issues \u2013 which is one of the key benefits we think a report would create.\u201d<\/span><\/p>\n

However, Craig Bennett, director of policy and campaigns at Friends of the Earth UK, said a lack of a common, mandatory approach to sustainability reporting is a \u201creal problem\u201d.<\/span><\/p>\n

\u201cIf anyone stood up and said companies should voluntarily report on financial matters, they would be laughed out of the room. So why not on their social and environmental reporting?\u201d<\/span><\/p>\n

Fiduciary duty should include ESG factors<\/span><\/h4>\n

Meanwhile, one of the biggest barriers in getting investment managers to invest sustainably is that many do not believe it is their fiduciary duty to consider environmental, social and governance (ESG) factors.<\/span><\/p>\n

The high-level panel says \u201ca review of investors\u2019 fiduciary responsibilities is needed\u201d, and Waygood said he would welcome such clarification.<\/span><\/p>\n

Nick Robins, head of the climate change centre of excellence at HSBC, told the meeting that one of the real tests for the success of Rio+20 is if it can convince investors to align their assets with the sustainable development agenda.<\/span><\/p>\n

He agreed with Waygood that \u201ca positive interpretation of fiduciary duty\u201d is needed and said that investors need \u201chard, reliable policy goals\u201d if they are to redirect investment to sustainable companies.<\/span><\/p>\n

\u201cIf you want sustainable development, you have to look for it in within the existing economic development process,\u201d said Janos Pasztor, executive secretary of the High-Level Panel on Global Sustainability, which published its report Resilient People, Resilient Planet<\/a><\/em> at the end of January.<\/span><\/p>\n

\u201cYou have to redirect investment and use limited public money to leverage\u201d private investment, he added.<\/span><\/p>\n

Original article published at www.environmental-finance.com<\/a><\/em><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Investors have welcomed a proposal to make companies report on their environmental and social impacts, to be discussed at the Rio+20 sustainable development summit in June, but say it could be improved in several...<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[4],"tags":[],"class_list":["post-996","post","type-post","status-publish","format-standard","hentry","category-news"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/earthsummit2012.stakeholderforum.org\/index.php\/wp-json\/wp\/v2\/posts\/996","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/earthsummit2012.stakeholderforum.org\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/earthsummit2012.stakeholderforum.org\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/earthsummit2012.stakeholderforum.org\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/earthsummit2012.stakeholderforum.org\/index.php\/wp-json\/wp\/v2\/comments?post=996"}],"version-history":[{"count":0,"href":"https:\/\/earthsummit2012.stakeholderforum.org\/index.php\/wp-json\/wp\/v2\/posts\/996\/revisions"}],"wp:attachment":[{"href":"https:\/\/earthsummit2012.stakeholderforum.org\/index.php\/wp-json\/wp\/v2\/media?parent=996"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/earthsummit2012.stakeholderforum.org\/index.php\/wp-json\/wp\/v2\/categories?post=996"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/earthsummit2012.stakeholderforum.org\/index.php\/wp-json\/wp\/v2\/tags?post=996"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}