Goldman, O&G Returns, Canada, Clean Energy Funds, and the UN
Here are 5 ESG insights you might have missed this week:
1. U.S. SEC Investigating Goldman Sachs over ESG Funds-
The U.S. Securities and Exchange Commission is looking into Goldman Sachs Group Inc's asset-management division over its funds that look to invest based on ESG standards.
The investigation is focused on Goldman Sachs' mutual-funds division, the report said on Friday, citing people familiar with the matter. The firm manages at least four funds that have clean-energy or ESG in their names.
The SEC earlier this year proposed a pair of rule changes aimed at stamping out unfounded claims by funds on their ESG credentials, and enforcing more standardization of such disclosures.
2. Canada Launches Greenhouse Gas Offset Credits to Help Tackle Emissions-
A set of rules stipulate how projects can generate tradeable credits by capturing gas emissions.
The government said protocols for four other sectors including agriculture and forest management are under way. It will also start developing protocols for carbon capture technology, which Canada’s high-polluting oil industry is betting on to slash its emissions, this summer.
The greenhouse gas offset credit system is intended to support a domestic carbon offset trading market, and the government said it will create new economic opportunities for companies and municipalities reducing emissions.
3. Oil And Gas Back in Vogue for Retail Investors-
Shares of energy majors have soared this year in the wake of war and surging commodity prices. But as the climate crisis rages, will the sector reward investors over the longer term?
After a bruising coronavirus pandemic, when oil demand collapsed and BP’s shares fell to a 27-year low, the so-called supermajors have come roaring back in 2022.
Shares in UK-listed Shell, Europe’s biggest oil company, are up 47 per cent since January, while BP’s have climbed 37 per cent. By contrast, the FTSE 100 is up less than 2 per cent, while the S&P 500 is down 14 per cent.
Link to Source: https://www.ft.com/content/3488236e-ff3b-47ad-9482-296c2f64a1f1
4. The One Way to Avoid Greenwashing in ESG Investing-
As criticism of the efficacy of ESG investing mounts over its acute susceptibility to greenwashing, one category has remained largely immune to calls for stricter regulation: clean-energy funds.
While the sector tied to wind and solar is perceived as reasonably safe when it comes to actually making a difference with your money, the bad news is that it’s been getting mostly pounded since early 2021.
The bottom line is that renewable energy companies have lost about 25% of their value since the start of last year. The industry has been vulnerable to rising interest rates and a business environment plagued by shortages of commodities required to make solar panels. Biden’s orders may be the start of a turnaround in quarters to come, but what should investors do right now?
5. U.N. ‘Race to Zero’ Campaign Toughens Standards for Company Net-Zero Plans-
The UN-backed Race to Zero campaign, has updated its minimum membership standards. Among the new additions are requirements to end fossil fuel finance and lobbying which goes against climate science.
The campaign has updated its criteria for membership, following an international consultation that received more than 200 comments. The criteria come into effect immediately for new joiners, while existing participants will have 12 months to update their approaches if needed.
A note about this change in the campaign’s new implementation guide for the updated criteria states that “‘fossil fuel phase down and out’ does not refer to a single universal date for all entities and sectors, but should instead be aligned to a global, science-based, just transition”.
One more thing: McKinsey’s 2021 ESG report on accelerating sustainable growth.
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