IPE ESG Briefing: Moving money to EM, tackling myths

It is often said that if investors really want to help the fight against climate change, they should focus on the emerging markets. Last month, IPE reported about a group of institutional investors committing to investing $400m (€369m) in an emerging markets strategy that focuses on public and private debt of clean infrastructure, clean technology and decarbonisation assets.

Jennifer Devine, head of the Wiltshire Pension Fund, one of the investors involved, told IPE that the investments would finance companies “which are either currently highly-emitting or providing solutions on their transition journeys”.

The 2024 proxy voting season is over and with a few weeks’ distance, Morningstar has published an initial analysis, finding that although ESG shareholder resolutions are still growing in number for the first time, the growth was primarily driven by ‘anti-ESG’ proponents. Morningstar also found that the decline in shareholder support for environmental and social resolutions continued in 2024, but appears to be slowing.

Lindsey Stewart, director of stewardship research and policy, also said that continued growth in the overall volume of resolutions with falling average support was likely to prompt further questions about both the quality of proposals being filed, as well as the future of the entire shareholder resolution process, from both institutional investors and companies.

My colleague Sophie Robinson-Tillett looked into voting rules in Europe for a feature in IPE’s latest issue, relaying how they are fragmented and some people think greater harmonisation is needed. In Italy, for example, a shareholder must own 2.5% of a company before it can file a resolution. In France, the figure is 0.5% all issued share capital; while in Spain it is 3% of the company’s total voting rights.

At the end of June, IPE hosted its first Transition Conference, handing out asset owner awards and hosting a series of thoughtful panel discussions. We were fortunate to have Sven Gentner, head of unit for corporate reporting, audit and credit rating agencies at the European Commission, on a panel focused on the EU’s sustainable finance policies.

The panellists spoke about the sustainable finance disclosure regulation (SFDR), but Gentner also tackled the EU’s new corporate sustainability reporting requirements, reassuring investors they would have access to sufficient information under upcoming corporate reporting requirements.

Last but not least, last month IPE hosted a series of op-eds from Iancu Daramus, a sustainable investment specialist, on myths of the energy transition. He started off with climate scenarios (are they overcooked?) before moving on to the rhetoric around tipping points and the net-zero agenda before wrapping up on a critical note about the push for standardised reporting. Any feedback? Do get in touch.

Happy August,

Susanna Rust 

ESG editor