B&M Retail — ESG QuickTake (9fin) (13 Nov)

TLDR: B&M Retail has an SBTi-verified well-below 2°C target to cut scope 1 and 2 emissions 25% by 2030 (baseline FY 21) and the group states it aims to reach net zero by 2040 (not SBTi-verified). The group does not report total waste data or any time-bound targets to reduce its waste. Electricity usage made up 2.6% of total emissions in FY 23. B&M does not have any time-bound targets to curb its electricity usage. In 2022, B&M was fined £1m after an electrician sustained serious burns in a warehouse explosion in Liverpool. In 2018, B&M was fined £480,000 for repeatedly selling knives to children.

Global Blue — ESG QuickTake (9fin) (13 Nov)

TLDR: Global Blue, a tourism shopping tax refund company, does not report its scope 3 emissions or have targets to curb its environmental impact. Global Blue lags behind its industry in terms of board gender diversity, with no women on its board of directors. Global Blue is involved in ongoing proceedings with the Portuguese Tax Authority related to incidents of fraud between 2010 and 2013. Global Blue has been financially impacted by the ongoing conflict in Ukraine.

Grupo Eroski — ESG QuickTake (9fin) (13 Nov)

TLDR: Eroski, a Spanish supermarket chain, reports some forward-looking climate transition information, but there are several potential shortfalls in its approach. Eroski states that in 2021 it eliminated all palm oil from its products, although it does not report its approach to other forest risk commodities. Fossil fuels represent 4% of Eroski’s revenue through its 40 petrol stations. Eroski has a globalised supply chain with over 9,000 suppliers but it lacks a supplier code of conduct. In 2023, Eroski recalled some products that had been infected with botulism, a toxin that attacks the human nervous system.

9fin featured content

The Olive Tranche — Definitions and distractions in ESG (9fin) (16 Nov)

In the inaugural edition of Jack David’s column, the Olive Tranche, he delves into a discussion on some of the main challenges that surround the term “ESG”. One of those is whether or not the term ESG is fit for purpose or if the debate surrounding the term is just a distraction from greater issues. The piece explores greenwashing risks and the anti-ESG movement in the US.

CBI Connect’23 — Planning for the 1.5°C transition (9fin) (17 Nov)

In this 9fin Feature, ESG analyst Sammy Cole reflects on the Climate Bond Initiative’s Connect 23 conference in London. The theme of the day; transition plans. While there was some optimism about global prospects for low-carbon transition, the panelists highlighted some key barriers to reaching 1.5ºC. For example, one panelist expressed skepticism surrounding the impact of EU regulations and weak KPIs linked to SLBs. 

State of Hawaii taps advisers to assess financial fallout from Maui wildfires (9fin) (13 Nov)

The state of Hawaii is seeking advice from O'Melveny and Ducera Partners to navigate the financial fallout from the Maui wildfires in August. Over 60 lawsuits have been brought against Hawaiian Electric and its parent company Hawaiian Electric Industries as of 7 November, according to the company. 

HY company news

Bankrupt Rite Aid sues US Justice Dept to stop opioid lawsuit (16 Nov)

Rite Aid has countersued the US Department of Justice (DOJ) to block a lawsuit the DOJ filed against Rite Aid in March alleging that it ignored red flags and illegally filled hundreds of thousands of prescriptions for addictive opioid medication. Rite Aid argued that, according to the US Bankruptcy law, the lawsuit cannot proceed while it is bankrupt. DOJ responded by stating the bankruptcy law does not impact its exercising powers. 

Charter Communications: Charter Communications to Pay $25 Million Penalty for Unauthorized Stock Buybacks (SEC) (15 Nov)

The US Securities & Exchange Commission (SEC) recently found that, from 2017 to 2021, Charter Communicationsallegedly used unauthorised provisions to change the total dollar amounts available to buy back stock and the timings of the buybacks. Charter said it has fully cooperated with the SEC investigation and has agreed to pay $25m to settle SEC charges.

Mattel stiffed UCLA on $49m children's hospital donation, lawsuit claims (Los Angeles Times) (14 Nov)

The lawsuit filed on behalf of the University of California and the UCLA Foundation, accuses Mattel of breach of contract for reneging on its original pledge — donating $49m to UCLA to support its children’s hospital. The lawsuit is seeking the full amount of the original pledge, plus damages for alleged financial difficulty arising from Mattel’s backing out decision. Mattel disputed the claim, arguing that UCLA abandoned its plans for the construction of a new tower in the children’s hospital, therefore breaching its contractual obligations. 

Fund manager Ninety One signals it won't approve Sasol climate report (16 Nov)

Ninety One, South Africa’s largest privately owned fund manager, signals it will vote against Sasol, South Africa’s second-largest greenhouse gas producer’s climate report at the upcoming annual general meeting. Odd Mutual Investment Managers which owns 4% of Sasol also indicated that it will vote against a number of Sasols resolutions including its climate report due to its poor performance on green targets and uncertainty over its ability to secure natural gas, a key component of meeting 2030 climate targets. This move increases pressure on Sasol to reassess its climate strategy.

NSO Group's request to dismiss WhatsApp spyware case rejected (16 Nov)

WhatsApp filed a lawsuit against NSO Group in 2019 claiming that it allegedly violated the Computer Fraud and Abuse Act by infecting the messaging app with their spyware. The NSO Group filed a petition to dismiss the lawsuit in April 2022, arguing that it could not be sued, as it was acting on behalf of a foreign government. This claim of so-called sovereign immunity was rejected by the US Supreme Court, which argued that the charges still apply and the lawsuit is ongoing. 

News stories

Global emissions set to fall only 2% by 2030 — UN report (14 Nov)

According to a recent report by the UN, if current national climate plans are implemented as intended, emissions can be expected to increase 9% above 2010 levels by the end of the decade. This is significantly short of the 43% reduction against 2019 levels needed to stay within the 1.5ºC target in the Paris Agreement. UN secretary general indicated that global ambition has stagnated over the past years which is misaligned with the science.

Oil and gas firms face virtually no extra borrowing costs, S&P finds (17 Nov)

Despite oil and gas accounting for over half of global energy-related carbon emissions in 2022, the sector’s borrowing costs have largely mirrored those for other debt issuers. According to a managing director at S&P, this indicates that “…lenders are not really baking in premiums for ESG related factors”. S&P highlighted that, while 40% of financial institutions have committed to reducing their scope 1 and 2 emissions, only a fifth have pledged to reduce scope 3 which is linked to its lending. 

Regulatory round-up

Banks may escape EU’s toughest ESG regulation so far (13 Nov)

Spain has submitted a proposal to exclude financial firms from the initial implementation of the Corporate Sustainability Due Diligence Directive (CSDDD), although the proposal requires member states agreement. There is widespread disagreement among policy makers on the inclusion of the financial sector, with some raising concerns that the international scope of the directive could have unintended negative consequences. 

‘Dark green’ Article 9 fund upgrade fails to materialise (16 Nov)

In April, the European Commission provided clarification on how asset managers should determine whether or not investments were sustainable. The guidance was expected to lead to a large number of Article 8 funds upgrading to Article 9, but just 35 of the expected 300 plus funds, were upgraded. A sustainable finance lead at Nordic Consultancy attributed the lack of upgrades to the inconsistent guidance by the EC. 

EU rules on methane leaks to hit oil and gas importers (15 Nov)

The EU has agreed to new rules that will require oil, gas, and coal companies to monitor, detect, and repair methane leaks. The rules will also apply to oil and gas importers, requiring importers to meet maximum methane intensity thresholds (currently undefined) by 2030. The new regulation proceeds COP 28 and a push by the EU and US to reduce global methane emissions by 30% by 2030.