Upcoming Events on Green Finance / 今期綠色金融活動一覽

  1. New Research: Deforestation for Agricultural Commodities – A Driver of Forest Fires in Brazil & Indonesia

    Published by: Chain Reaction Research

    Widespread fires in Brazilian tropical forests were at the center of media attention in 2019. NGOs, politicians and celebrities called for action to stop deforestation for soy and livestock, the main cause of the fires. Indonesia also endured extensive blazes in 2019, often linked to deforestation for palm oil. Forests in Brazil and Indonesia capture carbon, retaining vast amounts of carbon dioxide and regulating global temperatures. Fires release that stored CO2 back to the atmosphere, contributing to further climate change.

    In 2020, Chain Reaction Research developed this report to describe the main drivers of the fires in Brazil and Indonesia, the actors involved, the political context, and the risks for investors. View the link you can download the PDF of the report and watch the recording of a webinar Chain Reaction Research held to discuss their findings.

  2. New White Paper: Responsible Investment in Fixed Income

    Published by: Mercer

    This paper re-introduces Mercer’s RI framework used for other asset classes and applies it to fixed income. The paper is introductory, and highlights the ways in which clients can incorporate their responsible investment beliefs into their fixed income portfolios.       

  3. New Report: Portfolio Climate Risk Management – Case Studies on Evolving Best Practices

    Published by: Ceres in collaboration with AIGCC, IGCC and IIGCC

    As the climate crisis, its physical impacts and the transition to a net-zero emissions economy, all accelerate, global investors are increasingly recognising the material and financial risks to their portfolios. Acknowledging the economic materiality of climate change as investment risks, some leading global asset owners have become early movers in taking comprehensive action to identify, evaluate and manage climate-related risks in their portfolios.

    This report includes case studies which show a range of evolving best practices used by some of the largest global asset owners and financial institutions. Ceres developed these case studies in collaboration with international global partner networks including AIGCC, IGCC and IIGCC.

  4. New Report: The Rise of ESG in Passive Investments

    Published by: USSIF

    While the vast majority of sustainably invested assets are still in actively managed ESG funds, net flows into passively managed ESG funds have in recent years outpaced net flows into their actively managed counterparts.

    This report explores the growth of passive ESG investing and the debate on the effectiveness of passive ESG funds versus active ESG funds.

    It concludes with recommended best practices for passive fund asset managers to deepen ESG approaches and impact, including through proxy voting, company engagement, disclosure about their ESG incorporation techniques, impact measurement and field building.

    The report also includes profiles of ESG ETFs and index-based mutual funds that demonstrate a range of approaches to passively managed ESG investments.

  5. New White Paper: The Purpose of Corporations: A Tale of Two Theories

    Published by: Mercer

    This paper explores the tension between the two theories and explore methods of potentially reconciling the two theories. In a forthcoming Part II of this series we will address how investors can address the implications of this trend in their portfolios and how investors can get more involved in the promotion of stakeholder views as desired.

  6. Job Opportunity: Consultant/Manager (Hong Kong)

    Organisation: ENEA Consulting

    NEA Consulting is an international strategy consultancy dedicated to energy transition. We are based in Paris, Hong Kong and Melbourne and are now expanding our team. Join us to take part in the development of our Asian operations, to work on challenging energy issues, with further opportunities to work in Europe, Asia and Africa. We are looking for a motivated and experienced professional (>3 years of working experience for consultant, >5 years of working experience for manager) with a background in consulting / M&A, a strong interest in energy and a solid background in finance.

    The ideal candidate will be passionate about energy transition and energy access, precise and rigorous, while also demonstrating strong leadership and excellent written & verbal communication skills.

    He / she will be willing to contribute to the expansion of ENEA Consulting in Asia: while originally based out of Hong Kong, he / she will likely contribute to the development of ENEA in Singapore, with a possible relocation in the future.

Visit www.foe.org.hk for more news about Friends of the Earth (HK)!

Webinar – NGO Reserves and Investment (hosted by HKCSS)/網上研討會 – 非政府機構儲備及投資

Earlier in June, HKCSS published “A Concise Guide on NGO Reserves” and “A Concise Guide on NGO Investment”. The guides respectively describe the principles in handling NGOs’ reserves and investment and provide templates and related materials for readers’ reference.

The guides were developed with the advice of an Expert Group formed under the NGO Governance Platform Project. The members, coming from accounting and financial sectors, all have a depth of experience and knowledge in financial governance. In this webinar, we have invited four NGO representatives from the Expert Group, to explain how agencies should manage their reserves and make investment decisions. Speakers will also share on the roles of NGOs’ investment committee and the experience in developing reserve and investment policies.

Details as follows:

Date: 9 October 2020 (Friday)

Time: 6:00 – 7:30pm
The session will be conducted online via Zoom.  

Speakers:

  • Mr Anthony CHEUNG, Honorary Treasurer, Friends of the Earth (HK)
  • Ms Sabrina HO, Chairperson, The Child Development Centre
  • Ms Serena MAK, Board Governor, Friends of the Earth (HK)
  • Mr Peter WAN, Member, Steering Committee of the NGO Governance Platform Project, HKCSS

Language: Cantonese (materials in English)    

Target participants: NGO Board / committee members (top priority), Agency Heads, Advisors, Company Secretaries, Senior Management of HKCSS Agency Members  

Interested parties please register online on or before 2 October 2020 (Friday). Successful registrants will be notified by email by 6 October 2020 (Tuesday).  

For enquiries, please contact the Project team at 2922 9255.


社聯於六月出版了《非政府機構儲備簡明指南》《非政府機構投資簡明指南》,內容分別簡述機構儲備及投資的基本原則,並提供政策文件範例及相關參考資料。

兩份指南由「非政府機構董事網絡計劃」成立之專家小組提供指導編撰而成,成員為會計及金融界專業人士,有豐富的財務管治知識和經驗。是次研討會邀請到專家小組內的四位非政府機構代表,講解機構應如何管理儲備及作投資決定,並分享投資委員會的角色及機構制訂儲備和投資政策的實戰經驗。  

詳情如下:

日期:2020年10月9日(星期五)

時間:下午 6:00 – 7:30
研討會將於網上透過Zoom進行。

講者:

  • 香港地球之友榮譽司庫 張振宇先生
  • 明德兒童啟育中心主席 何智慧女士
  • 香港地球之友董事 麥礎允女士
  • 社聯非政府機構董事會網絡計劃督導委員會委員 尹錦滔先生

語言:廣東話(輔以英文資料)

目標對象:社聯機構會員的董事會及委員會成員(優先)、機構主管、顧問、公司秘書、相關管理人員

有興趣參加之人士,請於2020年10月2日(星期五)或之前按此於網上登記。成功報名者將於2020年10月6日(星期二)或之前獲電郵通知。

如有查詢,請致電 2922 9255 與香港社會服務聯會聯絡。


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What are Blue Bonds?

Green Finance Advisor of Friends of the Earth (HK)

Environmental risks continued to dominate the headline news and extreme weather has been the risk of greatest concern for a very long time. Climate change and the unsustainable use of marine resources are detrimental to the habitats of oceans and those whose livelihood rely on the bio diversity of marine life. In additional to the Green Finance, Blue Economy, especially Blue Bonds are likely to attract more interest and perhaps be the next frontier of some coastal countries’ development.

Blue bonds are debt instrument issued by governments, sovereigns, development banks to raise capital for projects with marine or ocean-based benefits. Blue Bonds aim to deliver financing to support a rage of environmental, social, and economic issues facing the marine sector.  The blue bond support programs of marine and ocean-related activities, financing the implementation of sustainable development goals on marine life as well as the transition towards a sustainable blue economy with a strengthened blue natural capital at its core.

The Aim of Blue Bond and the United Nations Sustainable Development Goals (SDGs)

The United Nations Sustainable Development Goals (SDGs) are becoming more influential as an organizing framework for many investors; private and public investors who are keen to look for a thematic investment approach, are also eager to align their investment strategy with the SDGs. In essence, there are 17 SDGs outlined by the UN, and in the context of Blue Bonds, SDG 14 (Conserve and sustainably use the oceans, seas and marine resources for sustainable development) is the most relevant in relation to contributing to good governance of the ocean and costal habits, deliver long term value to the ecosystem, reduce carbon emission or strengthen resilient livelihoods of people who depend on oceans and their resources in a changing climate. In particular the targets of this goal also emphasis on:

  • Reduce ocean acidification and pollution of all kinds
  • Restore ocean ecosystems
  • Support sustainable fisheries
  • End overfishing [1]

Seychelles Blue Bond

In October 2018,  with the support of the World Bank, the Government of Seychelles issued the world’s first sovereign blue bond and raised USD 15 million to support marine and ocean-based projects contributing positive environmental, economic and climate benefits to the Islands Nation. The Government of Seychelles recognized the need to build and sustain its use of fish stocks through proper government and management of the sector.  The Seychelles Blue Bond attracted interests amongst institutional and private investors who desire to take a bigger role to ensure the sustainable use of ocean and marine resources. Oceans are under increasing environmental stress, ranging from pollution to conversation of marine life.

Nordic-Baltic Blue Bond

In January 2019, a SEK 2 billion bond was also launched by the Nordic Investment Bank supporting water projects around the Baltic Sea and along the Nordic coastline.  The Nordic-Baltic Blue Bond targets at investors that are conscious of challenges facing the region’s water resources and it is also the first Blue Bond to attract impact investment in Baltic Sea Protection.  The issuance of the bond was a huge success and well received by investors, The bond was twice oversubscribed and in the end 21 investors participated in the issue.

Proceeds of Blue Bonds

Under the Seychelles bond, the proceeds from the transaction will be used to support the extension of marine protected areas, bolster governance of priority fisheries and the development of the Seychelles’ blue economy.  The beneficiaries of the proceeds will be local communities, civil society organizations and businesses who are seeking financing for activities that can support a transition to sustainable fisheries[2].

Similar to the Seychelles Bond, the new NIB from the Nordic- Baltic region targeted at investors who want to help protect the sensitive marine environment in the Baltic Sea and launched its first blue bond in February 2019.    Unlike the Seychelles Bond which emphasised on the remedial of overfishing and restore ecosystem, the Nordic-Baltic Blue Bond was renowned of its support to sewage management, reduction of water pollution and water-related measures coupled to climate change.  One of the most notable project supported by the Nordic-Baltic Blue Bone was the Nya Slussen project in Stockholm.  This project did not only provide clean transport solutions at the Slussen traffic hub, but also redevelop the Slussen water locks.  The expansion of the water locks increased the drainage capacity and accommodate higher floodgates by adding two larger water channels beside the locks.  The Nya Slussen redevelopment is critical to the flooding mitigation measure that will enable Stockholm and the Malar region to better prepare for and adopt to the effects of rising sea levels and more extreme weather conditions in the future.

Conclusion

As coastal ecosystems are increasingly recognized for their important role in balancing carbon emission and thereby mitigating the effects of climate change, it is expected that investment of a particular focus on climate changes and marine life will becoming more popular.  With the raving success of the Nordic-Baltic Blue Bond, it is further confirmed that investors have growing interest to use blue bonds for conversation and environment mitigation measure.  Furthermore, the blue economy is of growing importance and blue bonds offer an opportunity for private sector capital to be deployed to support sustainable investment.

[1] https://www.4climate.com/dev/wp-content/uploads/2019/04/Blue-Bonds_final.pdf

[2] https://www.credit-suisse.com/about-us-news/en/articles/news-and-expertise/ocean-preservation-and-sustainable-investing-202006.html


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Upcoming Events on Green Finance / 今期綠色金融活動一覽

  1. New Research: Global Public Investor 2020: Sustainable investment
    Published by: BNY Mellon and OMFIF

    Over 90% of global public investors have specific ESG (environment, social and governance) investment policies in place or are in the process of developing them, according to a new survey from BNY Mellon and the Official Monetary and Financial Institutions Forum (OMFIF).

    In supporting the post-pandemic recovery, global public investors will have a chance to build on the momentum of the sustainability agenda of recent years. They are also motivated to adopt ESG criteria by the potential for superior risk-adjusted returns. However, they still face significant barriers in scaling up these efforts. These include complexity compared with traditional assets, insufficient data, and the difficulty of measuring the impact and non-financial performance of their ESG investment strategies.


  2. New Report: Engaging on methane: results of the PRI collaborative engagement
    Published by: PRI

    Between 2017 and 2019, the PRI coordinated a collaborative engagement on methane with the oil and gas and utilities sectors. Thirty-six global institutional investors, representing approximately US$4.2trn, engaged with 31 companies across the oil and gas and utilities value chain. The objective was to persuade companies to measure, manage and reduce their methane emissions. In addition, investors sought to improve company disclosure and their own understanding of methane risks.

    This document presents the results of this engagement, summarising data on corporate improvements against the engagement’s scorecard over the course of the initiative. It is the third in a series covering methane, following the 2016 PRI and Environmental Defense Fund (EDF) report An investor’s guide to methane: engaging with oil and gas companies to manage a rising risk and 2018’s Setting the bar:Implementing TCFD recommendations for oil and gas methane disclosure, produced with EDF and Ceres.


  3. New Report: Carrots & Sticks – Sustainability Reporting Policy: Global Trends in Disclosure as the ESG Agenda Goes Mainstream
    Published by: GRI

    The Carrots & Sticks 2020 report, GRI’s flagship publication assessing the policy landscape for sustainability reporting, was launched on 22 July after a successful virtual Policy Dialogue.

    This 5th edition provides an analysis of the latest trends in reporting provisions, covering 614 reporting requirements and resources (a substantial increase on the 383 assessed in the previous report in 2016) across over 80 countries, including the world’s 60 largest economies. A new addition in 2020 is insights and context gathered through interviews with policymakers, who give their views on good practices in phasing in ESG disclosure requirements.


  4. New Guidance: Linking the GRI Standards and HKEX ESG Reporting Guide
    Published by GRIThis linkage document outlines the connections between the GRI Standards and Hong Kong Exchanges and Clearing Limited (HKEX) Environmental, Social and Governance Reporting Guide (ESG Reporting Guide). It is designed to facilitate the use of the GRI Standards when reporting on topics required by HKEX.


  5. New Report: Troubled Waters
    Published by: Blackrock Investment Institute

    The global pandemic has reinforced the importance of resilience in investment portfolios. This includes sustainability-related risks that investors may have been under appreciating, ranging from vulnerable global supply chains to health and safety issues. Blackrock believe increased asset flows into sustainable investing strategies in 2020 are part of a tectonic shift that could last decades.

    Physical risks posed by climate events – ranging from hurricanes to wildfires – have captured growing attention in the investment community. Blackrock in their report have zeroed in on these risks in Getting physical of April 2019, painting a granular picture of the financial implications across municipal bonds, commercial real estate and U.S. utility equities.

    In this piece, Blackrock extend their work on physical risks to water stress. What do we mean by water risk? One in four people globally live in regions at high risk of scarcity – with water demand exceeding supply – according to the World Resources Institute (WRI). This creates financial risks that investors today may not be pricing in. Examples include rising spending needs (to raise efficiency and meet tough regulations) and the cost of production disruptions (unavailability of water for agriculture or cooling power plants).


  6. New White Paper: Green Shoots in China: The ESG landscape
    Published by: Mercer

    With one of the largest and fastest-growing asset management markets in the world, actions taken by China’s government, regulators, asset managers and asset owners can have a lasting impact on global sustainability efforts. This article provides an overview of current policy and trends driving ESG practices among Chinese institutional investors and asset managers, highlighting key considerations for international investors in China’s capital markets.


  7. Online Event: AVCJ ESG Forum
    Organised by: AVCJ
    Date: 16th November

    In the past year, it has become apparent that the integration of environmental, social, and governance (ESG) factors into investment strategies matters more than ever before. As ESG moves into the mainstream across the globe, Asian GPs can expect to feel the pressure from their LPs as the dialogue begins to shift. It is therefore crucial not to be left behind.

    Co‐hosted by AVCJ and the PRI on 16 November in Hong Kong, the annual AVCJ ESG Forum returns in a hybrid format this year—combining a live in‐person conference with virtual and interactive broadcasts—to provide GPs with a deep dive into the latest trends and issues affecting ESG integration and impact investing around the world, and to foster dialogue and debate between GPs, LPs, and industry participants.

    PRI signatories can receive a 10% discount upon registration, to receive the promotion code please email james.robertson@unpri.org.

    Early confirmed speakers include:
  • Megan Starr, Global Head of Impact, The Carlyle Group
  • Suzanne Tavill, Global Head of Responsible Investing and Partner, StepStone
  •  Kevin Lu, Chairman, Asia, Partners Group
  • Vikram Raju, Impact Investing Council Chair, Head of Emerging Markets & Climate Impact, Morgan Stanley AIP
  • Kelly Christodoulou, ESG Investment Manager, AustralianSuper
  •  Huai Fong Chew, Regional Lead, Funds, East Asia & the Pacific, IFC
  • Ana Lei Ortiz, Managing Director, Hamilton Lane
  • David Russell, Head of Responsible Investment, Universities Superannuation Scheme
  •  Adam Black, Head of ESG and Sustainability, Coller Capital
  • Steve Okun, ASEAN Representative, EMPEA
  • Hannes Valtonen, Director of Compliance, Baring Private Equity Asia
  •   Katsuya Baba, Partner, Chief Administrative Officer, Advantage Partners

8. Webinar Recordings:


Visit www.foe.org.hk for more news about Friends of the Earth (HK)!