ESG Update as at 18 February 2020

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Australian and New Zealand ESG Updates

Altiorem to support sustainable investing

The former head of responsible investing at Colonial First State Global Asset Management, Pablo Berrutti, is launching a sustainable investing online support system, Altiorem. Altiorem is a registered charity that is to act as an online library and resource centre revolving around sustainable investing. Altiorem’s goals are to faciliate, promote and influence the industry towards sustainable and purposeful allocation of capital.

Altiorem will bring on student volunteers as contributors, create a mentoring network and membership system. The targets are investors, credit analysts and underwriters, along with other finance professionals with a sustainable investing interest.

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Global ESG Updates

Biggest global polluter Coca-Cola Amatil refuses to stop using single-use plastic bottles due to ‘consumer preferences’

The most polluting brand in the world in 2019, Coca-Cola Amatil, has stated that it does not intend to stop using single-use plastic bottles. At the World Economic Forum in Davos, sustainability head at the company, Bea Perez, said that consumers still want plastic bottles because they are lightweight and resealable. Coca-Cola Amatil has promised to recycle as many plastic bottles as it uses by 2030 and said it will use at least 50 per cent recycled materials in packaging with the same timeframe.

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ESG Research

Australian study: Renewables are cheaper than gas and coal

The CSIRO and the Australian Energy Market Operator have confirmed that after an update to a previous study, wind, solar and storage technology are the cheapest form of low-carbon options for Australia. The first report, GenCost 2018, found that wind and solar were by far the cheapest forms of new energy-generating technology, vastly superior to coal.

Thee updated draft study, GenCost 2019-20, was published on the AEMO site, confirming the 2018 study results. The Australian government promotes gas, carbon capture and nuclear, however, wind and solar, including the cost of storage, are still far cheaper.

ESG analyst sentiment survey

The Fidelity International Analyst Survey has revealed that 90 per cent of analysts have reported that some or all of their companies are focused on ESG.

Key findings include:

  • In 2019, 31 per cent of analysts surveyed said most companies they cover were increasing ESG efforts; 39 per cent said only a minority of companies had ESG issues on the radar; and 29 per cent said ESG was not on the corporate agenda, compared to seven per cent in 2020

  • In 2020, about 47 per cent said a minority of companies had ESG on the agenda, while 46 per cent said most companies are stepping up ESG efforts

  • In China, 80 per cent of analysts said they saw an increase in ESG emphasis at some or all of their companies in 2020, compared with 63 per cent in 2019 and 33 per cent in 2018

  • In North America in 2018, 58 per cent of analysts said ESG engagement was increasing, dropping in 2019 to 57 per cent, but sharply rising in 2020 to 91 per cent

  • European and Japanese analysts reported 100 per cent ESG engagement rates