News In Brief 10 July 2017


A flurry of news items this week about cars, including Volvo’s announcement that it will produce only electric or hybrid-fuel cars from 2019 onwards, and the plan of President Macron’s government for France to ban the sale of petrol and diesel cars by 2040, although given that is still 23 years away, a very different government may well be in power by then. Amid all this headline grabbing news, it may have been missed that a Scottish vehicle, created by Celtic Renewables, made its debut road trip fuelled by whisky waste residues. The Scottish start-up has a £9 million government grant to build a demonstrator plant in Grangemouth.


Opposition parties in the UK have called for Government to implement a money-back return scheme for plastic bottles, to help improve the country’s recycling efforts, which languish at a 59% rate compared to countries that already provide such a money-back scheme, such as the Nordic countries which have rates of more than 90%. Some research suggests that 5-13 million tonnes of plastic pollute the world’s oceans annually. The suggestion of a money-back returns’ scheme is reportedly gaining support from large drinks’ producers.


The Singapore-based Impact Investment Exchange (IIX) closed what it claims is the world’s first social sustainability bond to be listed on a stock exchange, the Women’s Livelihood Bond (WLB). IIX says the $8 million bond, with a return of 5.65%/year is expected to list on the Singapore Stock Exchange and is promised to be the “first in a series of IIX Social Sustainability Bonds and is projected to empower over 385,000 women across Southeast Asia through increased credit access, market linkages, and affordable goods and services…The bond aims to support a select group of high-impact enterprises and microfinance institutions in Cambodia, Vietnam, and the Philippines.”


Charity Bank said that its loan book had for the first time surpassed £100 million and gave details of its loan portfolio for 2017-18. In the past 15 years the bank has made loans totalling more than £185 million 850+ organisations making a beneficial social impact.


The large insurer Swiss Re made waves this week by announcing it would shift the whole of its $130 billion investment portfolio to the ESG indices managed by MSCI, and that its portfolio managers “will only have limited scope to deviate from those environmental, governance and social indices.” The company said these indices create better risk-adjusted returns and are therefore economically sensible besides being ethically desirable. Reuters reported that the Japanese Government Pension Investment Fund (GPIF) – the world’s biggest pension fund, with assets of $1.3 trillion – has allocated around 3% ($8.9 billion) of its Japanese stocks portfolio to socially responsible investments


This week Big Society Capital published its annual review for 2016, setting out its intention to focus its investment on three areas, funding schemes that provide homes for people in need, support communities and take early action to prevent problems. BSC will continue to invest with intermediary organisations rather than directly with charities by typically providing 3-10 year loans of between £500,000 and £15 million that generate a 4-5% return on investment.


A coalition of 79 asset managers with almost $8 trillion under management has written to the world’s largest companies calling for more information on labour practices in order to identify badly managed workforces. They include Schroders, Nordea and Legal and General Investment Management. All are signatories of the Workforce Disclosure Initiative (WDI) which has asked companies to provide annual data on their workforces. WDI was set up by ShareAction, the responsible investment organisation, and funded by the UK’s Department for International Development.



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