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The news that shaped the week in responsible investing

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Dear SRI reader,

Following on from the recent and revolutionary Article 173, yet another success made in France took place this week, on Tuesday. The €7 billion green bond issued by the AFT (Agence France Trésor), represents the largest green bond to be issued by a Euro-zone sovereign and it has already been oversubscribed 3 times. Analysts predict a continued surge in the green bond issuance in 2017, destined to shore up the global debt capital market issuance landscape. It is fair to say that quite a bit is being done to help investors, guide them and support sustainability. France is once again in the spotlight next week, as Paris will host a UNEP FI conference to celebrate the launch of the Principles for Positive Impact Finance - a set of high level guidelines, designed to "provide a common yet flexible framework for the business and finance community to identify and develop positive impact activities, entities and projects".

Rich times ahead and more challenges to face.

Happy reading,

Flavia Micilotta
- Eurosif's Executive Director

IT'S GOOD TO BE GREEN

Ground-breaking UN-supported digital tool to enhance green finance: A fintech-powered global financial service that aligns with sustainability, for example, will include a “carbon account” aside from the usual savings and credit accounts, enabling users to earn rewards for making green lifestyle choices.
A record breaking $93bn of green bonds issued in 2016: Environmental Finance's Green Bond Database shows there was $92.9 billion of issuance in 2016, which is just shy of the $100 billion predicted by some at the start of the year. This compares with $42 billion of issuance during 2015.
Major European investors back France green bond ‘milestone’: France has attracted major institutional backers for its inaugural green bond, launched yesterday, including Dutch and French pension investors. The deal was a €7bn 22-year green bond issued by Agence France Trésor (AFT), the government office managing French sovereign debt. The bond will pay a coupon of 1.75% and was priced at 100.162 for an issue yield of 1.741%.
China could issue $60bn of green bonds in 2017, says SynTao Green Finance: China could issue as much as $60 billion of green bonds in 2017, including its first sovereign bonds, as the country looks to step up its climate leadership.
Investment principles to be launched to help meet Sustainable Development Goals: An initiative will be launched next week to help align business and investment with the Sustainable Development Goals (SDGs).
The Principles for Positive Impact Finance are a set of high-level guidelines, and are designed to "provide a common yet flexible framework for the business and finance community to identify and develop positive impact activities, entities and projects".

MORE CHALLENGES AHEAD

International Standards Organisation (ISO) kicks off work to create world’s first climate finance standard: The International Standards Organisation (ISO), the world’s biggest voluntary standards setter, is recruiting investors and other stakeholders to help develop what could become the first internationally-approved certificate for climate performance.
How the EU can protect the world’s forest by tackling corruption: World leaders at the anti-corruption summit in London committed "to expose corruption wherever it is found, to pursue and punish those who perpetrate, facilitate or are complicit in it, to support the communities who have suffered from it, and to ensure it does not fester in our government institutions, businesses and communities”.
Germany needs to start coal phase-out by 2019 to honour Paris targets: Germany will need to have started to phase out coal by 2019 and to have got rid of it entirely by 2035 if it wants to reach its Paris climate commitments, according to WWF Germany’s Electric Future report.
Investors’ economic and financial models need rethinking if climate change objectives are to be met: The current economic and financial models used by the investment industry need to be reconsidered if the targets outlined in the 2015 Paris Climate Change Agreement are to be reached, according to a new report entitled Navigating low-carbon pathways from Hermes Investment Management. Doing so is the only way to address the valuation threats climate change poses to investment strategies, which is part of investors’ fiduciary responsibility to their clients.
EU Eyes Regulation, Fiduciary Duties To Aid 'Green' Finance: The European Union could introduce new rules forcing disclosure and demanding fresh capital buffers around environmentally friendly investments, the European Commission’s vice president and finance chief said Tuesday.

IN OTHER NEWS

Commission defends national rules on employee participation rights before the Court of Justice of the EU: The Commission therefore defended the right of Member States to guarantee employee participation rights as foreseen in the German legislation in question; the model of “Mitbestimmung” and its social objectives are thus in line with EU law.
Sweden’s pensions group agrees gender equality plan: The group — Pensionsgruppen — has published an action plan to equalise pensions between men and women, including the introduction of a simplified application process for the transfer of premium pension rights between spouses and registered partners.
UK Government publishes bill to trigger article 50: The government has published its bill to trigger article 50, shortly after announcing that MPs will get just five days to debate and scrutinise the measure that will trigger Britain’s departure from the EU.
Finance Watch says Capital Markets Union remains mostly unchanged, despite concerns raised by civil society: The European Commission launched a public consultation on the planned Capital Markets Union (CMU) mid-term review. Finance Watch, the public interest advocacy group working to make finance serve society, notes that CMU retains a number of major flaws that still need addressing, but also some welcome initiatives, such as developing common definitions and standards on sustainable finance, and addressing the tax bias for debt over equity.
Sustainability needs leaders motivated by a compelling purpose: Today, best in class means best for the planet and the people as well as best for profit. Tesla illustrates this ideal perfectly. Volkswagen illustrates the opposite. Walmart is executing what may be perhaps the most dramatic 180-degree turn, from a company that accelerated social and environmental depletion to one that champions sustainability and employee engagement. Walmart is boosting wages and exiting the supercenter footprint that gave it such unparalleled economies of scale.

QUOTE OF THE WEEK

"Investors should always be thinking about how they can be more constructive and effective stewards of their investments"

Luke Hildyard, the PLSA’s Policy Lead on Stewardship and Corporate Governance, talking to Eurosif for this month's Insight.

About Eurosif

Eurosif is the leading European association for the promotion and advancement of sustainable and responsible investment across Europe, for the benefit of its members.

Eurosif's purpose is to:

1. Promote best practice in Sustainable and Responsible Investment (SRI) on behalf of its members
2. Lobby for European regulation and legislation that supports the development of SRI
3. Support its members in developing their sustainable and responsible investment business
4. Promote the development of, and collaboration between SIFs across Europe
5. Provide research and analysis on the development and trends within the SRI market across Europe
6. Raise awareness of and increase demand for SRI throughout the European capital markets

www.eurosif.org

Eurosif’s EU Transparency registration number with the European Commission is 70659452143-78.

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