Today's Climate Change Commission release
The key changes from the draft report to the Government are:
- Historic emissions have been revised up – we are at a tougher starting point
- Lower uptake of electric vehicles forecasted
- Revisions lower the estimates of primary sector herd reductions
- Increased ambitions on waste
It’s not easy being green
- The Climate Change Commission’s final advice to the Government is due to be released next Wednesday. This follows a review of interested party submissions and feedback from the initial draft report.
- We do not see the key draft recommendations changing, but at the margin we might see some alterations to the Commission’s recommendations.
Social Spotlight I: Video
In relation to our first Social Spotlight research installment, Manager, ESG Research, Jorge Waayman sits down with Executive Director, Ainsley McLaren to discuss some of the initial findings.READ MORE
Social Spotlight I: Employee Engagement
- Employee engagement, among larger NZX-listed corporates, was assessed through company reports and a survey.
- We found a low level of disclosure on employee engagement scores, turnover and absenteeism with comparability between companies difficult.
- The majority of companies that did disclose showed improvements in their employee engagement scores and turnover, but not absenteeism.
- Sector dispersion is evident with the IT, Communication and Consumer Staples companies showing the greatest improvement in employee engagement survey
ESG themes from company reporting season
- Health and safety are being prioritised in response to COVID-19
- Companies are broadly improving gender diversity and pay gap disclosure
- There is a rising alignment with climate change reporting framework
Lifting the bonnet: Electric vehicle adoption, or a lack thereof?
- Electric vehicle (EV) adoption, among larger NZX-listed corporates, was assessed through a quantitative and behavioural survey
- There is low EV penetration in company fleets, on average, with significant dispersion between industry sectors
- Reputation benefits are ranked as the most important driver of EV transition
- A lack of suitable EV models is rated as the largest barrier to adoption, even above cost
- A majority of the companies surveyed had immediate plans to invest in more EVs, however this has likely changed in light of COVID-19
Ethical investing: walking the talk
In recent times, perhaps more visibly prior to COVID-19, it has been satisfying to see growing interest in, and demand for, ethical investment products. Ethical is the term most often used by New Zealand investors, whereas fund managers like Harbour use terminology such as “ESG” (Environmental, Social and Governance) and others might refer to “Responsible Investing”.
Taxonomy issues aside, what one investor considers ethi...
Findings from Harbour's carbon emissions research project
- 26 companies of the 55 studied disclosed emissions data (47%)
- There was wide variation in the quality of disclosure from companies
- Of the companies that disclosed, 52% had emissions on a decreasing trend
- Most companies record their emissions themselves and have no third-party verification
- Technological advancement is key with innovation in electrification, carbon capture and storage, and software solutions
- The Zero Carbon Bill, the Paris Agreement and the Emissions Trading Scheme are all important policy settings aimed to help decrease carbon emissions
- The Task Force on Climate-related Financial Disclosures (TCFD) recommendations are an increasingly popular framework for companies worldwide to report against, to ensure their climate change disclosure is meeting the needs of their investors.
4 sustainability trends from the latest company reporting season
- Sustainability disclosure has improved
- Key focuses include climate change, diversity and waste
- Real world impact alignment on the rise
Sustainability is Good for Returns
Harbour has been a signatory to the UN Principles of Responsible Investing since 2010 and is also a member of the Responsible Investing Association of Australasia.
Harbour is adding sustainability as an investment mega trend in our equities process
We continue to find integration of ESG factors is a positive factor for returns
An additional overlay of sustainability as a mega trend influence may provide better interaction an...