Are You Still In? Are You Signed on Yet? C’Mon – the Country Needs You!

by Hank Boerner, Chairman & Chief StrategistG&A Institute

Question of the Day:  Are YOU Still In?  Have you signed on?  “In” — that is, for the long haul on addressing the many challenges of climate change and related global warming issues.  And “signed on” — to the We Are Still In Movement (please see wearestillin.com for information).

Right now, there are more than 2,000 signatories to the statement that was released on June 5 (2017), right after President Donald Trump figuratively “tore up” the important, historic commitment of the United States of America to the COP 21 Paris Accord.

The new movement is a voluntary grassroots approach that includes a wide array of bold names in different sectors of the American economy (bold name highlights further down in this commentary for you).

The signatories include investors (asset owners and asset managers); mayors of cities and leaders of local municipalities; universities and colleges; state governors and state governments; and (very encouraging!) lots of American corporations.

Folks at Ceres and World Wildlife Fund (WWF) and various sustainable, responsible and impact investment thought leaders are helping to get the word around. (Thank you to Anne Kelly and Jessie Arnell at Ceres and Marty Spitzer at WWF.)

The message points for signatories of all stripes are:

Despite the Trump Administration reneging on an important commitment (governmental and moral!), major players in the U.S. economy are still in — and stepping up, moving ahead on climate action.

Signatories are committing to drive down carbon pollution and address head on the challenges related to climate change (and especially the part that human activity plays in the changes taking place).  The goals put in place and the ambitious goals to come will help to ensure that the United States remains in the game and a global leader in reducing carbon emissions.

The broad-based coalition driving the We Are Still In movement
Just in the month of June, those signing on included:

  • 199 cities and counties;
  • 9 U.S. states;
  • 1,531 business leaders and investors;
  • 308 universities and colleges.

These players agree that:

  1. government alone is not driving the process;
  2. the Paris Accord represents an important blueprint for creating new jobs (think solar, wind, geothermal, energy conservation, etc);
  3. create prosperity on a broad, domestic and global basis;
  4. create stability in the world community, with developed economies assisting less-developed nations as ALL embrace the promises made in Paris (almost 200 nations are signed; notably absent now sad to say are just the USA, Nicaragua and Syria).

The We Are Still In Movement is sending clear signals to the global community in Plain English — not always present in White House’s erratic and often contradictory communications — that leaders throughout the American economic scene, in all geographies, in all sectors, are moving forward to help this nation meet the goals promised in Paris.

We will keep America Great in the global efforts to address climate change issues and provide innovative, job-creating, environmentally-friendly solutions!

ECONOMIC POWER
The signatories to date represent 124 million people in this nation (1/3 of the population!) and contributing US$6.2 trillion to the national economy.  This includes 38 Fortune 500 companies(bravo!) representing US$2.1 trillion in annual revenues and employing 4.7 million team members.

Here is the “Open Letter to the International Community” from the Movement for important background: http://wearestillin.com/

So — back to the question…are you signed on yet?  You can find more information at: www.wearestillin.com  — where you can sign up!

A Brief Selection of Bold Names for Your Reference

CORPORATE SECTOR
Bloomberg, LP; Mars Incorporated; Amazon; eBay; Google; Levi Strauss; Seagate Technology; Sealed Air Corporation; Loring, Wolcott & Coolidge; The Estee Lauder Companies; Microsoft; Apple; Nike; Campbell Soup Company; IBM: The Hartford; Starbucks; Intel; International Flavors & Fragrances; Wal-Mart Stores; Toshiba American Business Solutions; Johnson Controls.

THE INVESTMENT COMMUNITY
CalPERS; CalSTRS; New York City Office of the Comptroller; Office of the New York State Comptroller; Oregon State Treasury; Green Century Capital Management; Washington State Investment Board; Northwest Coalition for Responsible Investment; Cornerstone Capital Group; Nathan Cummings Foundation; Ambata Capital; Boston Trust/Walden Asset Management; Amalgamated Bank; Moore Capital Management; Azzad Capital Management; Sustainability and Impact Investing Group of Rockefeller & Company; California Clean Energy Fund; California State Controller; Calvert Research and Management; Trillium Asset Management; Interfaith Center on Corporate Responsibility; Clean Yield Asset Management; Rhode Island State Treasurer; Zevin Asset Management; Connecticut Retirement Plans and Trust Funds.

STATES / GOVERNORS
California; Connecticut; Hawaii; New York; North Carolina; Oregon; Rhode Island; Virginia; Washington.

MAYORS  OF CITIES
The Honorables: Bill DeBlasio (New York City), Eric Garcetti (Los Angeles); Kasim Reed (Atlanta), Rahm Emanuel (Chicago),  Hillary Schieve (Reno, NV); Bridget Donnell Newton (Rockville MD).

ACADEMIC CENTERS
University of Iowa; University of Maryland, University College; University of Massachusetts; Arizona State University; Bates College; Oregon State University; Occidental College; Northwestern University; Rutgers, the State University of New Jersey; State University of New York (the colleges at Albany, New Paltz, Stony Brook, College of Environmental Science and Forestry, Cortland, Oswego, Orange).

FAMILY FOUNDATIONS
Linton Family Foundation; Lora & Martin Kelley Foundation; Merck Family Fund.

ENTREPRENEURS/SMALL BUSINESS
Keller Estate Winery; The Junkluggers; Crystal Mountain Resort; Rune’s Furniture; Sara Danielle Designs; Eco Promotional Products; Say It Forward Productions; Mom’s Organic Market; Sons and Daughters Farm; Fetzer Vineyards; RC Flying Cameras LLC; Dallas Maids LLC; Rocca Family Vineyards; York Machine Works; Joe’s Tree Service.

PROFESSIONAL PRACTICES
Steve Harvey Law LLC; BCK Law PC; Christopher Intellectual Property Law PLLC; the Hvizda Team LLC/Keller Williams Realty Metro; Jim Henry, Architect; CTA Architects and Engineers; Cycle Architecture + Planning.

ASSOCIATIONS
National Ski Areas Foundation; National Latino Farmers & Ranchers Trade Association; Outdoor Industry Association; U.S. Green Building Council.

And Of Course the Usual Suspects – Pioneering Leaders in Sustainability:
Bloomberg LP; Ben & Jerry’s; Patagonia; Unilever…and more.

We have provided a brief overview here – please do check out the full roster at the WeAreStillIin.com.

And of course, Governance & Accountability Institute, Inc. was an early signatory!

And the latch handle is out:  we invite you to sign on for your organization!

 

 

 

 

 

Resolved! The USA Will Move Forward Despite the Administration’s Cancellation of the Cop 21 -the Paris Accord

“Resolute!” – The root of the word comes down to us from the ancient Latin, meaning (over many centuries) to decide on and stay with a course of action.  We’re seeing that these days in the “resolve” of the US corporate community, in the resolute actions of many cities and municipalities, in the actions of a growing number of US states, and among institutional investors of all types, shapes and forms.

Their resolution?  To stay the course on addressing climate change issues as the Trump Administration swerves off the road and into the ditch with the abandonment of the COP 21 Paris Accord by the national government of the United States of America.

In our brief Top Story, we see comment highlights from an Environmental Leader conference, with experts Phil Pinson and Tim Porter.  The pair looked at White House actions and changes within US EPA and Department of Energy and observed that what actions and issues had in common now was “uncertainty” as to the future course of action.

What’s driving sustainability now without the official “push” of our national governmental infrastructure?  For companies: compliance; corporate mission; business performance; employee satisfaction; industry (peer) recognition…and this means (they said at the conference) companies are holding firm with 50% of those surveyed are showing no change in budgeting for sustainability.

At G&A Institute, we’re seeing many positive trends from 2016 and earlier holding fast even with speed bumps thrown up — like exiting the Paris Accord and being in the same category now as Syria and Nicaragua as national holdouts!

During 2016, G&A Institute Chair Hank Boerner assembled the trends that were driving Corporate Sustainability and Sustainable Investment forward — most are still powerful, positive drivers for change.  Trends Emerging! Looking Ahead of the Curve at ESG, Sustainability, CR, SRI Progressis available for you with our compliments — you can download your copy of Hank’s collected commentaries at:  http://bit.ly/TrendsConverging

Readers will continue to receive updates on the book’s content as conditions warrant — Hank shared his perspectives on the post-Paris environment with readers.

Send us your views on the post-Paris environment as the corporate, public, social and investment sectors continue to move forward.

Top Stories This Week…

Sustainability Will Endure Despite Trump’s Approach, Experts Say
(Monday – June 12, 2017)
Source: Environmental Leader – In the era of Trump, will the practice of sustainability remain a business priority? The answer is that 73% of companies expect their commitment to be the same while 21% plan to increase their involvement. Only 7.7% plan to…

Cuppa Joe? Many of us love our morning coffee (“the Joe”), but we should think more about growers at the source…

Ah, that morning coffee — so delicious for many of us.  The products of the “coffee belt,” encircling the globe just north and south of the Equator, are made from a valuable commodity — the coffee bean. Harvesting those is a US$100 billion annual commodity, writer Jodyn Cormier tells us on the Care2 web platform, second only to the value of the oil market.  And yet…she writes that the average coffee farmer gets $1,000 per season for his/her work.

That, Cormier concludes, makes coffee an industry that is inherently unbalanced and unfair.  And then the writer focuses on Vega Coffee (Nicaragua), a “subscription-based” coffee company that helps farmers pick, process, package, and ship quality beans direct to customers.  The customer gets the coffee within 5 days of roasting, “direct from farmers’ hands to theirs.”

The company’s founder explains how this differs from many parts of the traditional value chain in reaching developed nation coffee consumers:  The family farmer typically sells beans to a cooperative, which sells to another or larger cooperative, and then it’s to an exporter, then to a roaster (the importer), then to a coffee distributor, and on to a roaster wanting Nicaraguan coffee…and then through middlemen to retail outlets…to customer.

The Vega firm has a roastery in Nicaragua, and local farmers are involved in the roasting process, packaging the goods for export to the USA (every two weeks).  Farmer-to-roastery-to shipment to US customer.  And women are encouraged to get involved in the usually male-dominated cultivation activities.

And what about climate change?  The views from the coffee belt in Nicaragua are shared in the top story (below) as well as many other fascinating views.  Conclusion:  Vega believes people (read: we coffee consumers) should not have to trade quality for sustainability.  And they are showing how it can be done.

Author Jordyn Cormier is a Boston-based freelance writer and “avid outdoors woman.” The Care2 web platform is known for its “member petitions” resources, such as saving the rainforest and protesting President Trump’s offshore oil drilling agenda.

Should You Have to Choose Between Good Coffee and Sustainability?
(Monday – April 17, 2017)
Source: Care 2 – Coffee as a commodity is worth $100 billion worldwide—second only to oil. And yet, the average coffee farmer makes a paltry $1000 per season (which is about $3/day), and that’s without taking into consideration drought or disease…

In the Dark Days of White House / EPA Action on Climate Change, Here are 7 Encouraging Trends for You from Amy Augustine at Ceres

Horrible headlines now coming out on the developments at the White House regarding climate change, global warming, and related issues as campaign rhetoric is fitted, however clumsily or mean-spirited, to public governance to attempt to match ill-advised campaign promises.

The reality is that there are a number of very encouraging developments, trends that hold great promise for those of us who are not climate change deniers and think that global warming is a hoax coming from China to disadvantage American companies!

The Ceres staff members have long been engaging with, monitoring and advising (the rest of us) on critical issues in the areas of Corporate Sustainability – Responsibility – Citizenship – Environmental Management — and of course, the paths to more sustainable investing.

Amy Augustine, the senior director of corporate programs at Ceres, shares with us in our Top Story the seven trends she sees continuing to drive corporate sustainability in 2017.  Our view is that this could be a “hinge year” for the United States in terms of focus on climate change, global warming, societal issues, environmental management and host of related issues therein.  (As in. “the hinge of history” with things going this way or that, the before and after.)

Amy observes:  “Bold leadership, as well as individual collective action from influential companies and investors, is critical to ensure continued progress in achieving the ambitions of the historic Paris Climate Agreement and the United Nations Sustainable Development Goals (SDGs).”

The seven trends are encouraging: (1) U.S. corporate sector support for U.S. clean energy policy is accelerating;  (2) investor expectations continue to rise that public companies will disclose information on more climate change risks and opportunities. (Remember, the US SEC in 2010 reminded boards of companies that they have the responsibility to oversee risk, and that climate change is clearly a risk.  But that was yesterday, under the former Administration…today is the era of climate denial in the White House.)

Trend 4 is the focus on Water Risk — large-cap companies operating in water-stressed areas are not waiting for government action to conserve  protect water sources.  Amy Augustine cites the efforts of such responsible enterprises as General Mills, Gap and Pepsico engaging with policymakers in California to urge on stronger water management measures.

What about Trend 3 – and 5, 6 and 7?  The details are waiting for you in the Top Story (link below). Amy’s concluding comment is…”No doubt, company actions on all of these (7 trends fronts) will continue to evolve and hopefully accelerate; such leadership is more essential than ever.”

At G&A Institute, we’re doing our part to report on both sides of the hinge — the great things that have been accomplished in the “good days” of the past decade, and the threatening things that are proposed or (positions) adopted in these not-so-good-days at US EPA, the White House or in the Congress.  Do check out the second in the newsletter, our comments in G&A’s Sustainability-Update Blog on the latest moves by the President and EPA Administrator to attempt to roll back the rich legacy of the prior administration.  (You can sign up to receive updates as these are posted.)  Let us have your thoughts as well!

And, we invite you to download “Trends Converging,” the book prepared in 2016 by G&A Chair Hank Boerner, which sets out important information about where are as the climate change deniers/destroyers go to work in Washington DC to undo the progress made.  Click here to download the digital copy.

Top Story

7 Trends That Will Drive Corporate Sustainability in 2017
(Wednesday – March 22, 2017)
Source: Triple Pundit – As we confront a new political climate that is inspiring both uncertainty and rising citizen action, I am more convinced than ever that business must play a critical role in achieving a sustainable, equitable and clean-energy…

Climate Change Risk? Nah – The Deniers & Destroyers Are At Work – White House Attempts to Roll Back Obama Legacy

Deniers/Destroyers are at work – at US EPA — the White House — hoping/wishing for rollback of rich Obama legacy positions on climate change issues…

by Hank Boerner – Chairman, Chief Strategist – G&A Institute

March 28, 2017

In classic-CNN style we bring you !!!BREAKING NEWS!!! – the Climate Change Deniers and Environmental Regulatory Protection Destroyers are at work in Washington DC today.

You’ve heard the news by now: President Donald Trump and EPA Administrator E. Scott Pruitt are preening and pompously strutting as they announce the important beginnings of what they want (and hope!) to be the rollback of important environmental and public health protections of the Obama Administration … you know, the “job killers” that were at work putting coal miners out of business.

At least that’s some of the twisting, grasping, pretzel-elian logic that underpins the actions taken today (which in turn tells the Trump loyal voting base that yes, still another campaign promise is being carried out on their behalf).

During his early months in office, President Barack Obama signed important Executive Orders that addressed climate change issues and global warming challenges — and please here do note that these and other Presidential EOs are always based on (1) the existing statutes enacted by Congress and (2) the authority of the Office of the President.

You remember some of the key statutes involved in these issues  — The Clean Air Act (CAA); The Clean Water Act; (CWA) the foundations laid by the all-empowering National Environmental Policy Act (NEPA) …and other landmark legislation sensibly reached on a bipartisan basis over the decades since American rivers burst into flames.

Today, President Donald Trump signed [a very brief] EO with a flourish — the “Promoting Energy Independence and Economic Growth” Executive Order.

The action orders the U.S. Environmental Protection Agency to begin the [legal] process of un-doing or re-doing the nation’s Clean Power Plan, the keystone to President Obama’s actions to address global warming. (Or “climate change” if one is skittish about being on the side of the angels on this issues.)

Here is what today’s EO covers:

  • Executive (cabinet) departments and agencies will begin reviewing regulations that potentially burden the development/or use of domestic energy sources — and then suspend, revise or rescind those that “unduly burden” the development of domestic energy resources…beyond the degree necessary to protect the public interest.
  • All [Federal] agencies should take appropriate actions to promote clean air (!) and clean water (!) for the American People — oh, while following the law and the role of the Congress and the States concerning these matters. (One hopes this includes Flint, Michigan residents. We can hear great, cogent arguments in the Federal courts about all of this.)
  • Costs are to be considered — regarding “environmental improvements for the American People” — as, when “necessary and appropriate” environmental regulations are to be complied with…and the benefits must be greater than the cost.

This is encouraging, if only that it is stated to provide cover for legal challenges: Environmental regulations will be developed through transparent processes that employ the best available peer-reviewed science and economics!

  • All Federal agencies are to review actions that are described in the Trump Executive Order and then submit to the [White House] staffed departments and the Vice President their plan(s) to carry out the review for their agency.

Here’s The Important Deny/Destroy Actions

By swipe of pen, the President revoked these important cornerstones of the Obama Administration climate change legacy:

  • Executive Order 13653 (November 1, 2013) – “Preparing the U.S. for the Impacts of Climate Change.”
  • President Memorandum (June 25, 2013) – “Power Sector Carbon Pollution Standards.”
  • Presidential Memorandum (November 3, 2015) – “Mitigating Impact on Natural Resources from Development and Encouraging Related Private Investment.”
  • Presidential Memorandum (September 21, 2016) – “Climate Change and National Security.”
  • Report of the Executive Office of the President (June 2013) – “Climate Action Plan.”
  • Report of the Executive Office of the President (March 2014) – “Climate Action Plan Strategy to Reduce Methane Emissions.”
  • The Council on Environmental Quality guidance (August 5, 2016) – “Final Guidance for Federal Departments and Agencies on Consideration of GhGs and Effects of Climate Change in NEPA Reviews.”

And The Very Important Clean Power Plan…

  • A review of the EPA’s “Clean Power Plan,” to be suspended, revised or rescinded, or, new rules proposed following the steps necessary. This will affect:
  • The final rules of the Clean Power Plan (October 23, 2015) – “Carbon Pollution Emission Guidelines for Existing Stationary Sources: Electric Utility Generation Units”;
  • Final Rules (October 23, 2015) – “Standards of Performance for GhGs from New, Modified and Reconstructed Stationary Sources: Electric Utility Generating Units;
  • Proposed Rule (October 23, 2015) – “Federal Plan Requirements for GhGs Emissions from Electric Utility Generating Units Constructed before January 8, 2015”; “Model Trading Rules: Amendments to Framework Regulations”.
  • The Interagency Working Group on Social Cost of Greenhouse Gases – convened by the Council of Economic Advisors and the Director, Office of Management and Budget (OMB) — is disbanded, and the documents that established the “social cost of carbon” no longer represent public policy.

Beyond these specifics, the EO also orders the Secretary of the Interior to review its rules, and any guidance given, and (if appropriate) suspend, revise and rescind these. Included:

  • Final Rule (March 26, 2015) – “Oil and Gas: Hydraulic Fracturing on Federal and Indian Lands”;
  • Final Rule (November 4, 2016) – “General Provisions and Non-Federal Oil and Gas Rights”;
  • Final Rule (November 14, 2016) – “Management of Non-Federal Oil and Gas Rights”;
  • Final Rule (November 18, 2016) – “Waste Prevention, Production Subject to Royalties, and Resource Conservation.”

For the record: The EO is intended to (1) promote clean and safe development of “our Nation’s vast” energy sources; (2) avoid regulatory burdens that constrain production, energy growth and job creation; (3) assure the Nation’s geo-political security.

US SIF Weighs In

The influential trade association for sustainable, responsible and impact investing swiftly responded. Lisa Woll, CEO of US SIF, commented:

“On behalf of our 300 institutional members, US SIF belies the Administration should be working aggressively to reduce carbon in the atmosphere and that this Executive Order accomplishes the opposite.

“The United States is paying a high economic price from the ravages of severe drought, wildfires and storms associated with increased atmospheric levels of carbon. This is not the time to retreat from the call to protect current and succeeding generations from the catastrophic implications of further, unrestrained climate change.”

In the US SIF biennial survey of sustainable and impact investment assets, it should be noted here that U.S. money managers with US$1.42 trillion in AUM and institutional asset owners with $2.15 trillion in assets consider climate change risk in their investment analysis — that is three times the level in the prior survey in 2014.

Now — Investors – NGOs – State and local governments – social issue activists — business leaders — Federal and State courts — can push back HARD on these moves by the Trump Administration.

Otherwise, it could be drill, baby, drill — dig, baby, dig — and, hey, it’s good for us, we are assured by the Deflector-in-Chief and his merry band of wrongheaded Deniers/Destroyers in the Nation’s capital!

What do you think — what do you have to say? Weigh in our this commentary and share your thoughts – there’s space below to continue the conversation!

Climate Change Resolutions / and Investors’ Voting — “Hurricane” Coming in 2017 Shareholder Voting?

“Stormy Weather Ahead Warning”:  Climate Change Resolutions / and Investors’ Voting — “Hurricane” Coming in 2017 Shareholder Proxy Voting Season?

Guest Commentary – by Seth DuppstadtProxy Insight Limited

The United Nations‘ consensus reached in the “Paris Agreement” (COP 21), the goal to limit global temperature rise to within 2 degrees Celsius could turn shareholder support for climate change resolutions from a squall into a powerful hurricane at U.S. energy and utility companies this proxy season. says our team at Proxy Insight.

Example cited:  The BlackRock Investment Stewardship Team’s new guidance on climate risk engagement made the possibility of a Category 5 storm conceivable — if companies aren’t responsive.

During the 2016 corporate proxy season, a particularly successful subset of shareholder-sponsored climate change resolutions — known as 2 Degree Scenario (“2DS”) proposals —  averaged 37.73 percent shareholder support:

ISSUER MEETING DATE % FOR
Devon Energy Corporation 8-Jun-16 36.06
Southern Company (The) 25-May-16 34.46
Exxon Mobil Corporation 25-May-16 38.14
Chevron Corporation 25-May-16 40.76
FirstEnergy Corporation 17-May-16 31.9
Anadarko Petroleum Corporation 10-May-16 42
Occidental Petroleum Corporation 29-Apr-16 48.99
Noble Energy Inc. 26-Apr-16 25.1
AES Corporation (The) 21-Apr-16 42.21

 

This was a notably high level of support for a first-round shareholder proposal — especially for climate change related. *

Example:  The proposal at Occidental Petroleum almost gained a majority with 48.99% of votes cast in support (not including abstentions).

Proxy Insight data show Institutional Shareholder Services (ISS) recommended For votes for all nine 2DS resolutions, while proxy advisor Glass Lewis opposed one.

The shareholder resolutions ask companies to stress test their portfolios and report on financial risks that could occur in a low-carbon economy.

Up to 17 2DS resolutions are expected to move to vote at U.S. companies in 2017 proxy voting, according to Ceres.  (Ten will be filed at companies not having these resolutions before).  The next scheduled company voting on 2DS will be at AES Corp on April 20th. A preliminary proxy indicates Duke Energy shareholders will be voting on May 4.

*excluding non-US “Strategic Resilience for 2035” proposals (2015/16)

 TOP-10 INVESTORS (AUM) MOST FREQUENTLY SUPPORTING “2DS” CLIMATE CHANGE RESOLUTIONS

Investor For Against Abstain DNV Split
Deutsche Asset & Wealth Management 100.00% 0.00% 0.00% 0.00% 0.00%
Legal & General Investment Management 100.00% 0.00% 0.00% 0.00% 0.00%
Legg Mason Partners Fund Advisor, LLC. 100.00% 0.00% 0.00% 0.00% 0.00%
AXA Investment Managers 100.00% 0.00% 0.00% 0.00% 0.00%
APG (Stichting PF ABP) 100.00% 0.00% 0.00% 0.00% 0.00%
Schroders 100.00% 0.00% 0.00% 0.00% 0.00%
M&G Investment Management 100.00% 0.00% 0.00% 0.00% 0.00%
Aviva Investors 100.00% 0.00% 0.00% 0.00% 0.00%
Canada Pension Plan Investment Board (CPPIB) 100.00% 0.00% 0.00% 0.00% 0.00%
California Public Employees’ Retirement System (CalPERS) 100.00% 0.00% 0.00% 0.00% 0.00%

Information is available at:  https://www.linkedin.com/pulse/climate-change-voting-calm-before-storm-seth-duppstadt

Proxy Insight is the leading provider of global shareholder voting analytics.

Visit www.proxyinsight.com for more information, where you can also sign up for a trial or contact Seth Duppstadt, SVP Proxy Insight Limited at: seth.duppstadt@proxyinsight.com  Telephone:  646-513-4141

World’s Largest Asset Manager on Climate Risk Disclosure — the BlackRock Expectations of Public Company Boards and C-Suite

by Hank Boerner – Chairman and Chief Strategist – G&A Institute

Monday, March 13, 2017 — The world’s largest asset management firm has clear expectations that corporate managements will disclose more on climate risk to their shareholder base…BlackRock speaks out.  Corporate boards and C-Suite – Important News for You….

You all know BlackRock — this the New York City-based “world’s largest asset manager guiding individuals, financial professionals, and institutions in building better financial futures…”

“That includes offerings such as mutual fund, closed-end funds, managed accounts, alternative investments, iShares ETFs, defined contribution plans…”

And — “advocating for public policies that we believe are in our investors’ long-term interests…” “…ensuring long-term sustainability for the firm, client investments and the communities where we work…”

For BlackRock, Corporate Sustainability includes: (1) human capital, (2) corporate governance (3) environmental sustainability, (4) ethics and integrity, (5) inclusion and diversity, (6) advocating for public policy, and (7) health and safety.

In terms of Responsible Investing, the BlackRock approach includes (1) investment stewardship and (2) having a sustainable investing platform (targeting social and environmental objectives AND the all-important financial return).

So it should not come as a big surprise to the boards and managements of literally thousands of public issuers that BlackRock has great expectations regarding the individual company’s (in a portfolio or hope to be) climate change disclosure practices.

What We Are Doing/How We Do it – Shared by BlackRock

Right now the BlackRock managers are sharing with other asset owners & managers their approach to sustainable investing. There are important lessons for corporate managements in these explanations:

As part of the investment process, BlackRock continues to assess a range of factors (that could impact the long-term financial sustainability of the public companies or companies).

Over the past two years, a number of projects have helped BlackRock to more fully understand climate change. BlackRock believes that climate risk (climate risk/change issues) have the potential to present definitive risks and opportunities that could or will impact long-term shareholder value.

The BlackRock team members also contributed to external initiatives such as the Financial Stability Board’s (FSB) Task Force on Climate-related Financial Disclosure (TCFD) and the continued development of the voluntary reporting guidelines of the Sustainable Accounting Standards Board (SASB).

Larry Fink – the influential CEO of BlackRock — sent letters directly to the CEO’s of public companies in 2016 and then again recently (2017) that called attention to the need for the companies to help their investors better understand the ESG factors most relevant to the firm to generate value over time.

That especially includes more robust disclosure and reporting on the issues related to climate risk. (We need to keep in mind that “risk” has a companion — “opportunity,” as represented in the Chinese pictograph for a crisis.)

BlackRock’s Investment Stewardship Team meets with portfolio company managements and votes BlackRock shares at proxy voting time; if an issue is in focus and the C-suite will not make progress on the issue, the team will elevate the concern to the company’s board room. And they “may” in time vote against director nominees and for shareholders proposals that are on the right side of BlackRock’s own concerns.

Company Boards and Executives – for 2017

BlackRock engages with 1,500 companies (on average) every year. As (according to BlackRock) climate risk awareness and its engagement with companies on the issues is being advanced, and as the asset management firm’s own thinking on climate risk continues to evolve, that issue is on the table for the Investment Stewardship Team discussions with company managements in 2017.

Companies “most exposed” to climate risk will be encouraged as part of the discussions to consider reporting recommendations coming from the FSB Task Force.

And, the board will be expected to have “demonstrable fluency in how climate risk affects the business and management’s approach to adapting to and mitigating the risk. Corporate disclosure on all of this will be key to the ongoing relationship with the investor – BlackRock (with US$5 trillion and more AUM).

Other Investment Management Peers

Tim Smith, Director of ESG Shareholder Engagement at Walden Asset Management (Boston)

Tim Smith, Director of ESG Shareholder Engagement at Walden Asset Management (Boston) and long a robust and powerful voice in the sustainable investing movement, applauded BlackRock’s shared information.

“The announcement that climate risk will be a priority in their engagements with public companies is an exceedingly important message being sent by one of your largest shareholders. That they believe climate risk is a priority reinforces the importance of the issues for senior managements of public companies. We’re hopeful that BlackRock’s announcement and engagement on climate risk will result in active support for shareholder resolutions on climate change.”

Walden and others filed their own shareholder resolution with BlackRock asking for a review of the asset manager’s corporate proxy voting process and record on climate change.

BlackRock has been accused by investment peers for its proxy voting practices. For example, Climate Wire reported in 2016 that IF BlackRock and its large institutional investment peers had supported a climate resolution filed with Exxon Mobil (this was part of the not-for-profit Asset Owners Disclosure Project) the resolution would have passed in the final vote by shareholders.

We’ll see what the 2017 BlackRock moves mean in the corporate proxy season getting underway now with continued investor focus on climate change / climate risk / global warming disclosure and reporting demands.

As corporate sustainability consultants and advisors, we at G&A Institute (and as part of our pro bono research work as the exclusive Data Partners for the Global Reporting Initiative (GRI) in the United States) analyzed more than 1,500 report sustainability reports in 2016 — and we are seeing an increase now in 2017 early survey results that corporate disclosure on climate risk issues is definitely on the increase.

We will soon release the results of our team’s analysis of S&P 500(r) on sustainability reporting and related issues. Recall that our analysis last year found that 81 percent of the 500 companies were doing structured sustainability reporting.

There’s more information for you here:

https://www.blackrock.com/corporate/en-us/about-us/investment-stewardship/engagement-priorities

https://www.blackrock.com/corporate/en-us/literature/market-commentary/how-blackrock-investment-stewardship-engages-on-climate-risk-march2017.pdf

Asset Owners Disclosure Project:  http://aodproject.net/

Tim Smith / Walden Asset Management:

http://www.waldenassetmgmt.com/team/smith-timothy

 

 

On the Cutting Board: The US EPA Budget – Staff – Programs – Grants As the Trump Administration Plans the Coming FY Budget

The media establishment in Washington, DC is closely watching the signals as well as specific action taken by the Trump Administration and the 115th Congress that could or does affect the future of key government agencies whose mission and work directly/indirectly affects the mission and work of corporate sustainability and sustainable investing professionals.

Especially In focus:  the US Environmental Protection Agency; the Department of Energy; the Department of the Interior; the Securities & Exchange Commission; the Department of Defense…and others.

The news so far is not good. For the most part, as the leadership of these agencies and departments turns over and Trump appointees are coming in, a number of the new leaders actually oppose existing agency and department programs — and in some cases have expressed their intention to eliminate the agencies that they are appointed to lead!

In traditional Washington style, there are the official pronouncements and statements by “un-named officials” in the growing volume of media reports; there also Trump campaign positions being re-stated as “perspectives” in the news and commentary (editorials).

The Washington Post writers Juliet Eilperin and Brady Dennis for example analyzed a plan (“leaked?”) by the Trump White House to drastically cut US EPA staff, eliminate dozens of programs, and use the offset in “saved funds” to then fund increases in the defense budget.

The EPA budget would be slashed from US$8.2 billion to $6.2 billion — and with much of the funding going to state and municipal governments (grants), the impact could be even more significant for EPA core functions in protecting human health and the environment.

The Top Story this week is a good wrap up of what seems to be in store for the nation’s “top cop” on the environment, and expert opinions regarding the new administration plans as the 2017-2018 FY budget is prepared for submission to the Congress.

We also offer G&A Institute’s perspectives on this and related news stories emanating in the nation’s capital city in our blog Sustainability Update (link here: Dangerous Antics – Fiddling with the Future of US EPA and the Health and Safety of the American People)  at the bottom of this newsletter.

With climate change deniers moving into powerful positions in the Federal government — and a passel of deniers in charge at the state level — the gains made in environmental protection and in advancing sustainability are at stake.  In our news wrap up, we share “good news” and “bad news” with you every week so that you can take action.  We are staying on the top of the news to present these types of headlines / and accompanying stories for you:

White House Eyes Plan to Cut EPA Staff by One-Fifth, Eliminating Key Programs
(Thursday – March 02, 2017)
Source: Washington Post – The White House has proposed deep cuts to the Environmental Protection Agency’s budget that would reduce the agency’s staff by one-fifth in the first year and eliminate dozens of programs, according to details of a plan reviewed…

“Wolf” Now at the Head of EPA – No Disguises Needed to Fool the Sheep (er, We-the-People)

Is the Wolf disguised in sheep’s clothing? Nah — not to worry about any disguising — the wolf’s intentions were well signaled to us — the Denier/Destroyer-in-Chief at U.S. EPA is doing exactly what we expected him to do….

Remember from childhood days when our parent or caregiver told us the story of the “wolf in sheep’s clothing…” We were being cautioned, in one of the many of our early “life’s lessons,” to be careful about the advice we received, to look beyond the words, to watch people’s actions as well as hearing their words.

Because — often the legendary “wolf” would don sheep’s clothing (hey, that’s a great disguise) to mingle with the innocent flock of sheep (that the ravenous wolf really wanted to feed on). Watch out, sheep — and people!

This tale comes down to us in various forms came from different sources, including the Holy Bible, New Testament, with Jesus warning about false prophets. We’re reminded of this brief moral tale (a perennial fable of sorts that developed over the centuries) as we watched the nominees of the Trump Administration.

What do they have to say to pass muster at the U.S. Senate nominations hearing — and what are their real intentions — what will they in fact do while in office to harm our society?

Well, we don’t have to watch the top wolf there at 1200 Pennsylvania Avenue, N.W. — just down the road from the White House. The new EPA Administrator Scott Pruitt let us know with both his past performance and his clearly-stated words his intentions now that he is at the helm of the US EPA ship: he is not a believer that climate change has any relationship to human activities. Like carbon emissions – GhGs to be more accurate.

Administrator Pruitt told his CNBC interviewer on a popular cable program that many investors tune in to: “I think that measuring with precision human activity on the climate is something very challenging to do and there’s tremendous disagreement about the degree of impact, so … I would not agree that it’s a primary contributor to the global warming that we see.  (Emphasis ours.)

Pruitt:  “We need to continue the debate…and the review…and the analysis.” CO2 emissions are not the primary cause, the Administrator mused.

Past Actions – Prelude to Future Actions?

Keep in mind here that this is the former Oklahoma Attorney General who sued the EPA some 13 times.

As Huffington Post’s Dominique Mosbergen put it in January 2017: “It’s a safe assumption that Pruitt could be the most hostile EPA Administrator toward clean air and safe drinking water in history.”

Oh, and on his Linked In page, pre-EPA AG Pruitt noted he was “…the leading advocate against the EPA’s activist agenda…”

Commented writer Mosbergen about EPA’s role in our society (and that agenda):

“The EPA’s mission is to protect human health and the environment by issuing regulations and enforcing the nation’s environmental laws. Under President Barack Obama, the EPA created the Clean Power Plan, which aims to cut carbon pollution from power plants. It also issued new guidance for the Clean Water Act to protect thousands of waterways and wetlands, and introduced measures to limit emissions from heavy-duty trucks and reduce smog and mercury emissions from industrial sources.”

Yes, We Can Expect Changes — Dramatic at That

Now that Administrator Scott Pruit is firmly installed by fellow Senate Republicans at the EPA — we can expect these positive, fact-based actions to rapidly change. For example, here is what his own EPA (the Agency’s official web site) says about this (today):

“Recent climate changes, however, cannot be explained by natural causes alone. Research indicates that natural causes do not explain most observed warming, especially warming since the mid-20th century. Rather, it is extremely likely that human activities have been the dominant cause of that warming…”

And as posted before Election Day in October 2016: “…greenhouse gas emissions have increased the greenhouse effect and caused Earth’s surface temperature to rise. The primary human activity affecting the amount and rate of climate change is greenhouse gas emissions from the burning of fossil fuels.”

Question: Will these posts be up there next Monday morning?

These EPA positions are based in part on the National Research Council work — “Advancing the Science of Climate Warming,” published by National Academies Press.

We should keep watch on all of the EPA information channels to see the interference of the new leadership in the good work of the Agency.  Watch for fake news, of course, and counter that with FACTS.  Science is cool as reference point.

Watch for missing news — up there today – gone in the morning — too much information for the sheep.

Other Governments on the Move

Beyond the EPA Washington DC offices, of course other governments believe in environmental protection — and climate change measures!  (Think”  Paris Accord, COP 21 – now in danger in the Administrator’s hand.)

The Intergovernmental Panel on Climate Change (IPCC) said in February 2017 the above after the COP 21 Paris gathering of the world’s government leaders: “The selection of the authors for the IPCC’s 1.5oC report is the first step in the critical journey started at COP 21. This special report will facilitate this important journey by assessing the available science and highlighting the policy options available to support the achievement of a climate safe, equitable and sustainable world,” said Debra Roberts, Co-Chair of Working Group II.”

Assessments of climate change by the IPCC, drawing on the work of hundreds of scientists from all over the world, enable policymakers at all levels of government in many nationsto take sound, evidence-based decisions.

They represent extraordinary value as the authors volunteer their time and expertise. The running costs of the Secretariat, including the organization of meetings and travel costs of delegates from developing countries and countries with economies in transition, are covered through the IPCC Trust Fund…”

Can we now expect that the U.S.A. — with EPA in the lead — will be absent from study and deliberations? Withdraw financial and other support from the IPCC organization?  Deny the outcomes of any research?  (Hmmm….we have to have more studies…”)

That’s what classic deniers/destroyers do in public policy circles — create & sow doubt, deny agencies their funding, change staff to hire more kool-aid drinkers, destroy enforcement capabilities  — and remove “climate change” or “global warming”references  from official web sites.

As the Republican Governor of Florida recently did — the state agencies can’t use such references (climate change?  what’s that?).

Never mind that parts of his state will be underwater with seas rising — including Mar-a-Lago, the “other” White House sitting quite near the beautiful ocean’s edge!.  Much of the Florida expensive waterfronts will move considerably far inland toward Disney World and the I-4 corridor as the oceans warm, ice shelfs recede and glaciers in Antarctica melt…and…and…

OK — we were and are warned — the dangerous wolf is in the head office and not in disguise at the EPA and the sheep (we, The People) will surely be the victims of his wrongheaded and dangerous strategies and tactics as long as he is in control.

We hear you, former EPA Administrator Gina McCarthy:  “When it comes to climate change, the evidence is robust and overwhelmingly clear that the cost of inaction is unacceptably high.”   We miss you, for sure!

Global Warming – As the Phenomenon Ends, The Ice Begins? In Year 2060

by Hank Boerner – Chairman & Chief Strategist – G&A Institute

Keep your eye on 2060, when the Ice Age begins and Global Warming ends, say the folks at Samsung Chemical Coating (“SCC”) in The New York Times advertisement…

Did the headline grab your attention? It sure caught mine.

The headline and some of the content from a full-page advertisement appearing today in The New York Times, is signed by Samsung Chemical Coating Co. Ltd. (for the record, they’ve also said this is material “copyrighted” and not for re-distribution). This is Fair Use reporting for you.

The ad is a full page display in the well-read Science Times Section of the Times; titled: “When Global Warming Ends, about the year 2060, The Ice Age will Begin”).

There are five main messages for you from Samsung:

(1) (Perspectives About) the Beginning of Global Warming

(2) There is No Relationship Between the Amount of Carbon Dioxide Emissions and the Global Warming

(3) (About the) Ice Age Environment

(4) Large Extinction of Living Things (like all of us humans)

(5) (Message to) The US Government and Scott Pruitt, US EPA

Highlights:

Global Warming, says Samsung (SCC) management, is one of the natural phenomena that occurs at the end of inter-glacial periods. There is more explanation for you (according to the ad) in The Washington Post on February 28th of a “study” by Samsung. *

There is no relationship between CO2 emissions and global warming. It’s about Earth wobbling (“precession*), certain star tracks, and seas warming and rising.

The Earth’s glaciers (today’s Big Ice) will be reduced by Year 2060 at, the end of the inter-glacial period we’re in, and then the Earth will begin to form new glaciers; earthquakes and tsunami’s will occur; radiation from the sun will pummel Earth; extreme temperatures will occur; really large hurricanes will occur.

And then – oh, boy! — the New Ice Age coming about 2060 will reach to New York City, growing ever-taller over 200 years, and everything living will become extinct!  The dead critturs will eventually drift down to decay and become coal and carbon/oil for future generations (if there any) to use. There may well be; Samsung’s paid message says creatures exposed to the sun’s radiation will mutate and new species will emerge.

Finally — Samsung, while saying that nothing can be done about the catastrophe coming, thanks to the Law of Nature (and Earth wobble, stars aligning, oceans warming, pole ice disappearing, glaciers melting and then re-forming, radiation increasing, giant storms, and more) — and so,  Scott Pruitt, US EPA Administrator, “…should review the results of ]Samsung’s] study and find ALTERNATIVE (my emphasis) MEASURES to minimize the damage of the catastrophe that will occur…”

Oh, and the future of Mankind depends on Administrator Pruitt and President Donald Trump.

A key line in the ad:  “We can say that the cause of global warming is not from carbon dioxide emissions.”

The company – it’s a a privately-owned South Korean firm, according to Bloomberg LP  — has run somewhat similar ads in the past.  * We could find no mention of “the study” in The Washington Post edition of February 28, 2017 as mentioned in today’s ad.

We got to thinking: Is this a joke? (It’s not April 1st yet.)  Someone who gave up tweeting to write more long-form messages in the wee hours of the morning?  Something unusual to get us thinking? About?

Is this a planned distraction from the more pressing issues in Washington DC — like the former President spying on the new President when he was a candidate? Something really jarring to justify the drastic cuts proposed by the new administration at the US EPA?  Is this fodder for global warming deniers?

The ad is real:  I have a printed copy right here on the desk as it appears in the NYT ScienceTimes Section!

What to you think?  Let us know….

FINALLY — there is an email in the ad if you wanted to communicate with someone:

  • Heemun Kang – scck22@hanmail.net
  • or Jimin Kang or Josung Kang

** Precession:  changes that occur as equinoxes change in successive sidereal year (Oxford: sidereal — “as determined by stars”).