Microsoft shareholders call for a right to repair

Greetings from Colorado, where the Aspen Institute took a dramatic leap into post-pandemic survival this week by hosting part of the annual “IRL” – In Real Life Ideas Day. The leading themes at this year’s event were racial diversity and sustainability, and Chip Bergh, the chief executive officer of Levi Strauss, made a fervent call to arms. “If we as CEOs don’t act on structural racism and inequality. . . as leaders [we] is complicit in structural racism,” he stated, noting that the Blacks protests in 2020 had caused a personal “calculation” for him, shows “what is the privilege of the white man”.

But how can CEOs navigate the boundaries of changing social norms? Bergh admits this is difficult because the definition of sustainability is constantly changing – and ESG requires difficult trade-offs. “The job of the CEO has become a lot harder over the past few years,” he said.

Today’s newsletter proves it: see how antitrust converges with ESG as global regulators increase scrutiny – and how companies are engaging in new restructuring strategies to reply. (Gillian Tett)

‘Right to Repair’ – the convergence of ESG and antitrust

“Right to repair” – one’s freedom to repair broken cars and electronics instead of buying new items – has become an increasingly common issue in the United States and Europe, and now This has gained new relevance to the ESG world.

On June 24, As You Sow, a nonprofit organization that is one of ESG’s largest shareholder proposal applicants, published a petition with Microsoft, calling for the company to analyze environmental and social benefits of making their devices more easily repairable. This is believed to be the first shareholder rights repair proposal filed in a US company.

“Microsoft positions itself as a climate and environmental leader, but still facilitates the early burial of its devices by limiting consumer access to its repairability. suffer,” said Kelly McBeewaste program coordinator at As You Sow.

McBee said part of the impetus for submitting the proposal was a recent report by the US Federal Trade Commission on repair rights. The May report said there was “little evidence to support manufacturers’ justification for the repair restrictions” and that the agency “will consider options for law enforcement and management to be integrated again.” ” for the repair problem.

Microsoft has published a device sustainability report alongside its overall sustainability statement. “Microsoft provides consumers with safe, effective, and high-quality repair services that protect their privacy, security, and protect them from injury,” a company spokesperson said in a statement. An announcement. “We are committed to designing our products to deliver what our customers need and want in a premium device, while also increasing repairability and durability.”

As an unprecedented shareholder proposal, it remains to be seen how Microsoft shareholders will react to the right to fix petition. The company is rated highly for ESG and sustainability, and investors may be inclined to ignore it. But if the right to repair issue becomes a legitimate antitrust threat, then Microsoft investors will need to treat it as a more serious business risk. (Patrick Temple-West)

Sunak unveils £15 billion of green bonds

The UK Treasury has announced that it will fulfill its pledge to issue green bonds, saying this week it will make at least two transactions totaling at least £15 billion.

During the annual Mansion House speech on Thursday, the prime minister Rishi Sunak enhanced UK plan to require companies, pensions and investment products to disclose sustainability. The Treasury also said it would introduce sustainability disclosure requirements to bring together and streamline existing climate reporting requirements ahead of the United Nations COP26 summit in Glasgow in September. 11.

But as Boris Johnson’s government promotes its green aspirations, it is facing fury from environmentalists over oil projects in the North Sea. The Guardian reported that environmentalists have discovered a flaw that prevents more than 1 billion barrels of oil from being tested for climate compatibility. Earlier, the government said it would allow oil drillers to continue to explore in the North Sea as long as they pass a climate compatibility test. (Patrick Temple-West)

Global securities regulators establish oversight of ESG

Last year, the International Organization of Securities Commissions (Iosco) announced that it would be analyzing the ESG investment space to determine where disclosure could be harmonized and where investors could be subject to fraud. cheat.

On Wednesday, Iosco, the global umbrella body for securities regulators, published its recommendations for the ESG asset management sector.

As assets under management in ESG funds boom, concerns have arisen “about the consistency and comparability of information regarding sustainability and greenwashing,” it said. Ashley Alder, head of Hong Kong’s securities regulator and chairman of Iosco. He added: “This report provides Iosco’s view of the regulatory and supervisory expectations needed to assist asset managers in addressing these challenges.

Iosco recommends that securities regulators strengthen their supervision of the sustainable investment market. Enforcement tools can help prevent greenwashing, and as a starting point, securities regulators should review the rules they already have on their books to pursue potential misconduct. . For example, marketing materials and website disclosures must conform to regulatory documents, Iosco said.

The report notes that the US Securities and Exchange Commission this year established a team within its enforcement division to track down ESG misconduct. In Europe, the Danish Financial Supervisory Authority has set up a team dedicated to sustainability issues.

“ESG sells, [and] Greenwashing, whether intentional or not, can be seen as a way to support this growing trend and attract more investors interested in environmental and climate issues.” Hortense BioyGlobal director of sustainability research at Morningstar. (Patrick Temple-West)

Generation Z is not ready to pay for sustainable fashion

Adding a $7 dress to her digital cart, my friend glanced in my direction and said that if it doesn’t fit the loss is “practically negligible”, noting that she always has You can choose to resell or donate it.

Shein, the fast-fashion retailer known for its lowest prices, quickly captured the attention of Gen Z shoppers. In May, the e-commerce site overtook Amazon for became the most downloaded app in the US and is estimated to be worth $15 billion, according to Pitchbook.

Shein’s popularity stands in stark contrast to polls that suggest young people are the most stable in their purchasing decisions.

“Price and availability remain the top driving factors for most purchasing decisions.” Don Vaughnhead of product for personal data company Invisfinity told Moral Money.

Good On You, an ethical and sustainable brand review site, rated Shein as “very poor,” the lowest score. Despite trademark disputes and low sustainability ratings, investors are still flocking to the Chinese company.

Assuming that Generation Z consumers are consumers who are significantly different from their elders may be naive, even if they were willing to answer another affirmative questionnaire. (Kristen Talman)

Can business drive a low-carbon future?

Heavy industry has had a long relationship with carbon, but breaking up could make both parties better off.

Russian aluminum giant Rusal is planning to phase out some old smelters, refineries and mines to focus on carbon-lite production methods.

The split appears to be more than just a fee to reorganize investment bankers. The recent comments by Rusal America executives have caught our eye as a key sign that clean goods production is being driven by consumer demand.

Speaking to S&P Global Platts last month, Brian Hesse, director of Rusal Americas, said home improvement company Lowe’s has started asking for carbon content in the scale. It’s remarkable that consumers seem to care about the sustainability of simple products like ladders – especially considering the popularity of fast fashion retailers like Shein, as Kristen mentions here. above.

In June, South Africa’s Anglo American energy company mimicked Rusal’s shift with a coal trading company Thungela Resources. It is seen as a test of investors’ appetite for highly polluting resources.

While Rusal and Anglo mine for dirty assets, other companies are looking to bring renewable energy businesses into the hot clean energy market.

Italian energy company Eni is looking to sell its renewable energy business in a public offering or minority stake. This change makes sense because the government’s net zero commitments are spurring investors to look for new green opportunities.

According to IHS Markit, “Further decarbonisation in the heating, transport and industrial sectors – driven by the economy-wide net zero carbon targets set by both national governments and corporations – offers significant growth potential for renewables,” according to IHS Markit. (Patrick Temple-West)

Intraday chart

With a review of EU climate legislation scheduled for later this month, ministers from countries including Finland, Estonia and Sweden have requested that “all forms” of bioenergy are now stamped. Labels as renewable also qualify as sustainable investments. It is not too subtle a reminder that if the status of biomass is changed, the EU may be nearly unable to meet its renewable energy target to provide a third of all energy used in the world. the whole region by 2030. Please read Camilla HodgsonRead aloud about biomass here.

Read smart

• The shipping industry, which contributes nearly 3% of global emissions, is in the wake of decarbonisation, FT’s Peggy Hollinger write. Formerly exempted from the Kyoto protocol 25 years ago, the EU is planning to lay out guidelines for the maritime industry within carbon limits and the trading system (EU-ETS) over a two-week period.

read more

• Insurance industry feels the heat covering fossil fuels (FT)

• BlackRock, State Street Conservator ESG Policy After the Republican Controversy (Bloomberg)

• Credit Suisse CEO says sustainable investment no longer means lower returns (CNBC)

• Dirty bond cleaners discount books in ESG Credential Query (Bloomberg)

• Regulators tighten oversight of asset managers to prevent ‘green wiping’ (Reuters)