Market Wrap
ESG Wrap — Beef between JBS and activists over proposed listing, Teva fined for cartel participation
- 9fin team
•3 min read
This is the weekly ESG Wrap, which highlights Featured 9fin ESG content such as TLDRs for all deals, news stories that have interested the ESG team this week, and 9fin ESG product updates.
Secondary Analysis
ESG Secondary Digest — RCS & RDS, Wepa, Takko (9fin) (23/08/2023)
Find ESG secondary market coverage on RSC & RDS, Wepa and Takko in this week’s Secondary Digest. RCS and RDS performs poorly compared to peers in terms of emissions reduction targets and waste management. Wepa’s GHG emissions targets are robust and in line with peers. Takko’s supply chain has been linked with child labour in the past.
9fin Featured Content
Cloud 9fin — ESG specialist Rupert Davies talks setbacks and opportunities (9fin) (24/08/2023)
ESG investing has come under greater scrutiny for its ability to effect change in recent months, following controversy around the Sustainable Finance Disclosure Regulation in Europe and rising political pushback against the movement in the US. In this week’s episode, our host Jennifer Munnings sat down with Rupert Davies, a sustainable finance specialist, to discuss frankly the state of ESG.
HY company news
Environmental activists pressure US regulators to halt JBS listing (23/08/2023)
A collective of environmental activists sent letters to the US Securities & Exchange Commission (SEC) urging it to prevent JBS SA from completing its planned New York share listing. The activists raised concerns over the company’s impact on deforestation, climate change and other related issues. JBS had hopes a US listing would help it to gain access to cheaper capital.
According to the US Department of Justice, Teva will pay a $225m criminal penalty for participation in a domestic antitrust cartel. In addition to the penalty, it must also divest its drug lines for pravastatin and make a $50m drug donation to humanitarian organisations.
Leonardo CEO Under Investigation Over His Time as Italy Minister (21/08/2023)
According to Bloomberg sources, Italian authorities are investigating Leonardo CEO Roberto Cingolan for actions he allegedly undertook during his time as Italian minister for the environmental transition (before joining Leonardo). The CEO has been accused of renewing a permit on a Solvay SA plant that had been dumping chemical waste on a beach in Tuscany.
News stories
Bond Investors Warned of ‘Trouble Brewing’ Over Climate Risk (21/08/2023)
According to the Institute for Energy Economics and Financial Analysis, bond investors can no longer depend on credit ratings for a reliable assessment of climate risk and should expect “trouble ahead”. Fitch has warned that 20% of corporates will face downgrades due to climate change in the next 10 years, while Moody’s has said credit risks related to ESG are rising. S&P also cautioned that climate change is having a big impact on credit ratings.
Fossil Fuel Subsidies Hit $1.3 Trillion Despite Government Pledges to End Them (24/08/2023)
A new International Monetary Fund (IMF) report has found that both explicit and implicit fossil fuel subsidies across 170 countries have risen a lot in recent years. Explicit subsidies, in particular, rose from $500bn in 2020 to $1.3tr in 2022, due to government efforts to mitigate the inflationary impact of the Ukraine war.
Junk Offsets Are Feeding Wave of Greenwashing, Study Shows (24/08/2023)
A study published in the journal Science analysed 18 carbon-offset projects and found that just 6% of a potential 89m credits issued from the projects were linked to carbon reductions that were additional. This highlights concerns of greenwashing and questions the legitimacy of carbon-neutral claims from companies relying on such credits, including TotalEnergies and British Airways.
A recent CDP report suggests that nature is consistently overlooked in financial decision-making by most financial institutions. CDP found that there are gaps in accounting for nature reported across governance, strategy and implementation, risk management, and metrics and targets mechanisms of most financial institutions.
