Edition for 21 February 2020

Top Stories

‘Monstrous’ run for responsible stocks stokes fears of a bubble (FT)

  • Inflows into ESG funds are driving up stock prices for companies with green credentials.
  • Investors last year ploughed a record $21bn into socially-responsible investment funds in the US, almost quadrupling the rate of inflows in 2018, according to Morningstar, the data provider.
  • Some analysts welcome the price gaps, seeing them as validation of the idea that listed companies should pay attention to the needs of all stakeholders — including employees, customers and society as a whole.
  • Others worry about a bubble in areas such as renewable energy, pushing prices to unsustainable highs.

JP Morgan economists warn of 'catastrophic' climate change (BBC News)

  • Human life "as we know it" could be threatened by climate change, economists at JP Morgan have warned.
  • Climate campaigners have previously criticised JP Morgan for its investments in fossil fuels.
  • While JP Morgan economists have warned about unpredictability in climate change before, the language used in the new report was very forceful.

Alberta public pensions being used to prop up struggling carbon industry, union says (CBC)

  • The Alberta Investment Management Corp., or AIMCo, says the investment of nearly $115 billion it manages for 31 pension, endowment and government funds to carbon-intensive industries that could be affected by efforts to fight climate change is on par with that of similar funds around the world.It points to figures suggesting that risk is declining.
  • Other measures suggest the fund's carbon footprint has increased by nearly two-thirds since 2015.
  • Earlier this year, one of the world's largest investment groups, BlackRock, announced it would put climate and sustainability at the centre of how it decides to invest its $7-trillion fund.

Australia's banks have to face climate stress tests, regulator says (The Sydney Morning Herald)

  • That's the message from Australia's banking regulator as it joined its counterparts in the UK, the Netherlands and Singapore in ramping up its surveillance of how ready financial institutions are to deal with climate change.
  • Banks will have to undertake stress tests to measure their resilience to a broad range of scenarios, including "climate change financial risks," the Australian Prudential Regulation Authority said in a statement on Friday.
  • Australia's banks will have to assess how vulnerable they are to climate change.Credit:Ryan Stuart Regulators around the world are starting to push banks and insurers to quantify their exposure to climate change risks amid increasing concerns that the financial system is unprepared for the likely reshaping of markets as the weather becomes more extreme.

Accounting watchdog to probe companies on climate change (Independent.ie)

  • Protesters and Investors have been increasing pressure on big business to take action on climate change.
  • Britain’s companies will have to ensure that their climate reporting is up to scratch as the accounting watchdog launched a major review into the issue, while pressure ramps up from both environmental activists and investors.
  • The regulator said that it will look at the level of resources that auditors such as Deloitte and KPMG have to help their staff assess the climate change impact of the firms they audit.

Bank report card: Three of Big Five banks fail to deliver ethical investment options (Corporate Knights)

  • From millennials looking to stash their retirement savings in line with their ethics all the way up the corporate ladder to the world’s largest investment houses vowing to put climate action at the heart of investment decisions, conscious investing is quickly gaining traction.
  • One CIBC branch advisor told Corporate Knights that “all the mutual funds we offer have gone through these ESG (environmental, social and governance) checks.” Ditto for all of RBC’s funds around the globe.
  • That doesn’t mean they screen out any dubious companies or sectors (Tim Nash does a solid job of explaining ESG tools versus negative screens here).

Climate change now displaces more people than war, and India should be worried (Quartz)

  • A grim prophecy made years ago by climate scientists and experts is coming true now.
  • Other reports such as those of the Intergovernmental Panel on Climate Change (IPCC) have warned that the worst impact of climate change will be seen on human migration, as the number and intensity of disasters increase.
  • In 2018, the World Bank projected that there will be more than 143 million internal climate migrants by 2050, in just three regions of the world (Sub-Saharan Africa, South Asia, Latin America), if no climate action is taken.

Revealed: quarter of all tweets about climate crisis produced by bots (Guardian)

  • Draft of Brown study says findings suggest ‘substantial impact of mechanized bots in amplifying denialist messages’.
  • The social media conversation over the climate crisis is being reshaped by an army of automated Twitter bots, with a new analysis finding that a quarter of all tweets about climate on an average day are produced by bots, the Guardian can reveal.
  • The stunning levels of Twitter bot activity on topics related to global heating and the climate crisis is distorting the online discourse to include far more climate science denialism than it would otherwise.
  • An analysis of millions of tweets from around the period when Donald Trump announced the US would withdraw from the Paris climate agreement found that bots tended to applaud the president for his actions and spread misinformation about the science.

The Climate Sentinel is an AI-powered news assistant for ESG investors and those concerned about climate change, corporate social responsibility, and related topics. Learn more.

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