Good Advice for Corporate Boards on Sustainability From Bob Eccles - Prominent Harvard Business School Voice
 


Good Advice for Corporate Boards on Sustainability >From Bob Eccles - Prominent Harvard Business School Voice

Professor Bob Eccles of Harvard Business School is out front and very vocal on key corporate sustainability issues (like the global Integrated Reporting movement and continued expansion of sustainable investing). In a Forbes commentary he offers advice for corporate leadership on “how to show corporate leadership [in sustainability], posing the question to boards and C-suite:  “What progress are we seeing in how boards of directors of public companies demonstrate leadership in sustainability?”

The answer comes in part from a 2014 report by the Ceres coalition that found only 32% of the boards of the 613 largest publicly traded companies had oversight (over their company’s sustainability efforts). Alas, the good professor observes, most companies see ESG and “E’ and “S” and “g” is lower case.  Take Volkswagen as an example, Eccles writes -- weak governance seriously undermined the company’s “E” efforts (one of the major leverage points for company products) and jeopardizes the “S” (social) efforts. 

Eccles’s argument:  “Weak corporate governance on sustainability inhibits companies’ abilities to profit from sustainability.”  And, investors (seeking more profit) would like companies to do that (generate more profit) and investor’s interests in having long-term profitability will be inhibited as well.  Bob Eccles is not too optimistic about rapid change at the board level on sustainability issues, but is optimistic that over the long-term, if investors make it clear that they are interested in long-term as well as short-term performance…well, things could change more quickly.

As we observe the business sector activities on sustainability, and the rapid and dramatic rise now in corporate sustainability by key capital market players (asset owners and managers), we are encouraged that the board and C-suite attitudes toward corporate responsibility could change very quickly.  Big names / big money is paying attention on Wall Street (Morgan Stanley, Goldman Sachs, BlackRock, MSCI, State Street, Citi Group, and many more top brands are focusing on ESG performance).

There’s more here for your board and C-suite if you would like to pass along the advice of Professor Eccles – we invite you to read the top story in this week’s newsletter. 

Top Story of the Week

How To Show Corporate Leadership In Sustainability
(Wednesday - November 04, 2015)
Source: Forbes - A 2014 report by Ceres, a non-profit organization advocating for sustainability leadership, found that only 32 percent of the largest 613 publicly traded U.S. companies had board oversight over sustainability.


Sustainability in Focus

The Future Of Business Lies In Sustainability
(Monday - November 02, 2015) Associated Profiles : Corporate Knights
Source: The Huffington Post - Unilever isn't alone. Corporate Knights magazine publishes an annual list of the 100 most socially responsible corporations in the world--companies making incredible strides in combining progress with...

Why good governance is critical for sustainable cities
(Monday - November 02, 2015)
Source: GreenBiz - There are five key factors for making cities work: access to information, public participation, institutional capacity, accountability, and resilience. These categories encompass a range of issues related to urban governance...
 
Seven employee engagement challenges facing every sustainability manager
(Monday - November 02, 2015)
Source: Business Green - Sustainability managers know staff behavior is key to making your sustainability plans a reality. Most large organizations have an employee engagement program and/or a group of volunteer champions to take the message out to...

Australia's next boom lies in sustainability
(Monday - November 02, 2015)
Source: Eco-Business - Australia can make up for the dwindling investments in mining by riding on the rising global demand for sustainable goods and services. A new report by the Future Business Council shows how the country can tap into this...

Speaking Sustainably -Could patriotism motivate Americans to use less energy?  
(Monday - November 02, 2015)
Source: GreenBiz - Several years ago, back when we were still fighting a war in Iraq and we were all very tense about that, we tested some messaging around national security as a reason to make one’s home more energy efficient.

Property sustainability should be more about the human than the environment
(Monday - November 02, 2015) Associated Profiles : Dow Jones Sustainability Index
Source:  thefifthestate.com.au - Globally, the expansion of indices like the Dow Jones Sustainability Index and the Global Reporting Initiative have expanded the reach of a common language around sustainability performance. As a result...

Beyond the Promise: 25 Global Brands and the Evolving Sustainability Tagline for Humanity
(Tuesday - November 03, 2015)
Source: The Huffington Post - We are relentlessly bombarded by big, iconic, and new brands that work hard to make themselves heard and visible as frequently and distinctly as possible. Creating strong brand identity and earning consumer trust requires...

Getting Sustainability on the Agenda of Our Dysfunctional Federal Government
(Tuesday - November 03, 2015)
Source: The Huffington Post - Last week I participated in a very timely panel discussion at Columbia University on the impact of climate and the environment on the 2016 elections. The panel was moderated by Chuck Todd, the brilliant and politically savvy...

5 Brands Going Big on Sustainability
(Tuesday - November 03, 2015)
Source: Triple Pundit - It’s 2015, and planet earth ain’t what it used to be. With extreme weather conditions like hurricanes, heat waves, droughts and polar vortexes becoming the norm, people are started to take these signs of significant global...

Report: Millennials Key Drivers of Small Business Sustainability
(Wednesday - November 04, 2015)
Source: Sustainable Brands - Millennials will lead the way for small and medium businesses (SMBs) in future conversations and efforts around conservation, energy efficiency and environmental stewardship, according to a new survey by Cox Enterprises

The Importance of a Product Sustainability Program
(Wednesday - November 04, 2015)
Source: Just Means - The global population is expected to be over nine billion by mid-century. Feeding that many people without “exceeding ecological and social limits” presents the food and beverage industry with “unique challenges,” proclaims a...

World Exchanges Agree Enhanced Sustainability Guidance
(Thursday - November 05, 2015)
Source: Investor Ideas - The World Federation of Exchanges has presented recommendations to its member exchanges on how to implement their sustainability policies, the culmination of a year-long project by its Sustainability Working Group.
 
Sustainability: The New Norm in Real Estate Development and Investing
(Thursday - November 05, 2015)
Source: National Real Estate Investor - Time was when the idea of sustainability in real estate development and investing was a pretty soft notion. Sure, everyone liked the “idea” of reducing carbon emissions, protecting the environment and exploring alternative energy...

ESG Issues & Players

Climate Change Kills the Mood: Economists Warn of Less Sex on a Warmer Planet
(Tuesday - November 03, 2015)
Source: Bloomberg -  Climate change has been blamed for many things over the years. Never, until now, has anyone thought it was possible...

The Tough Realities of the Paris Climate Talks
(Wednesday - November 04, 2015) Associated Profiles : Intergovernmental Panel on Climate Change(IPCC)
Source:  New York Times - According to scenarios used by the United Nations Intergovernmental Panel on Climate Change, global annual per capita emissions would need to fall from today's five metric tons to less than one ton by 2075, a...

Dodd-Frank SEC guidance executive compensation – status
(Tuesday - November 03, 2015)
Source: Lexology - With all the rulemaking required under the Dodd-Frank Act, it can sometimes be hard to keep up with the status of the various rules. Below is a handy chart that details the current status of the various executive ...

Guardian Live: should we say yes to nuclear power?  
(Tuesday - November 03, 2015)
Source: Guardian - Last month George Osborne backed a deal with China to build a £24bn nuclear power plant at Hinkley Point in Somerset. The government claims the new plant will be relied on to deliver 7% of the UK’s electricity while providing a...

Asset Managers, US Pension Funds,
Sovereign Wealth Funds

Forget socially responsible; this fund cashes in on sin
(Monday - November 02, 2015)
Source: CNBC - Socially responsible investing has become one of the hottest trends in finance, with trillions of dollars flowing into ethically aware funds. But on the other side of the coin lies the Barrier Fund — formerly known as the Vice...

Hunt for Billions Invested by 1MDB Points to Australia
(Tuesday - November 03, 2015) Associated Profiles : International Petroleum Investment Company (IPIC)
Source: Wall Street Journal - To enable Deloitte to sign off on its books after KMPG was fired, 1MDB got a unit of a government investment fund in Abu Dhabi known as the International Petroleum Investment Company to guarantee the...

Vermont Invests $150 Million In Funds Of Hedge Funds
(Tuesday - November 03, 2015) Associated Profiles : Vermont State Retirement System
Source:  FIN Alternatives - The Vermont State Retirement System has made its first hedge fund hires. The $3 billion pension fund last week allocated 5% to hedge funds, and quickly picked three firms to fill that allocation, Pensions &...


Watching the Watchers

Folksam

Headquarters: Stockholm, Sweden
Established: 1908

KEY PARTNERS
Storebrand
and Harcourt are partners for Belair (Lux) Sustainable Alternatives SRI Fund, a fund of hedge funds. Involved in Nordic Engagement Cooperation with Ilmarinen and KLP, with screening from GES Investment Services.
 
OVERVIEW / MISSION
Folksam is one of Sweden’s largest insurance companies and investment managers. Assets in early 2011 were listed on the Folksam Web site as SEK 280 billion, and the firm works with pension funds. Folksam is a mutual issuer owned by its members.

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Harvard’s Eccles on the UN SDGs – They Are “Good for Business”

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