More

    The Long and the Short of 2021

    The year started slowly and cautiously, mostly in virtual mode. To get in the mood, we listened to Skagen’s 18th New Year conference where we heard Mark Mobius praise benevolent dictatorsNassim Nicholas Taleb not worried about climate change among others, including Mike Berners-Lee (author of “There is no planet B”). January saw a more prominent event: the One Planet Summit for Biodiversity and a handful of asset managers founded the Natural Capital Investment Alliance. And after unrest on the Capitol, Biden finally accessed to the throne and revealed his climate plan. At the IFL conference on Green Banking, Christine Lagarde talked about belling the cat, which inspired our first Snap column.

    February saw a bunch of asset managers and asset owners committing to net zero and officially displaying their roadmaps to align with the Paris Agreements. Nordea, Handelsbanken, AP2 and AP4 were among those and SEB followed suit a little later. Meanwhile, Norges Bank Investment Management (NBIM) set board diversity goals.

    March was clearly marked by SFDR-day. We looked at the early experiences in the Nordics with both asset managers and the local FSAs. A few days later, the EU Platform on Sustainable Finance published its Transition Finance Report with recommendations on how to fine tune the still eagerly awaited taxonomy. The IIGCC also launched the Net-zero investment framework. A sign that ESG is being taken seriously on the other side of the Atlantic, the US SEC added a Climate and ESG Task Force in the Division of Enforcement.

    Mid April, the latest draft of the EC’s Delegated Act for EU’s Taxonomy of sustainable economic activities leaked and revealed that, among other disappointments, nuclear and gas would be excluded from the first taxonomy. As a result, 9 of the 67 experts that make up the Platform on Sustainable Finance threatened to quit. The same month, the US convened a Virtual Leaders Summit on Climate, where both the US and China set unprecedented targets.

    At the beginning of MayGermany announced a new goal to achieve a 65% reduction in CO2 emissions by 2030, followed by a 88% reduction by 2040. And at the end of the month, in a ground breaking decision, the District Court in The Hague ruled against Royal Dutch Shell which will now have to reduce its global CO2 emissions by 45% from 2019 levels by 2030.

    As the price of EU emission allowances continued its strong upwards ascendance, we took a closer look at the carbon credit market in June. Then came the usual summer slumber in July, but the EU Platform on Sustainable Finance didn’t leave for the beach just yet and published a draft for the social taxonomy after a series of insightful webinars.

    August saw the unfolding of a whistleblower affair involving ex-sustainability head Desiree Fixler and former employer DWS, which eventually prompted a regulatory investigation, a cautionary tale for the greenwashers out there. The same month, Swedish steel manufacturer SSAB produced the first fossil-free steel.

    At the beginning of September, the EC published a new Green Bond Framework. In an effort reinforce action against corruption, AP1, Folksam, SEB Investment Management, Skandia, the Church of Sweden and Swedfund launched a new Investors Integrity Forum. Meanwhile, the Netherlands saw another ruling in favour of the plaintiffs in a greenwashing case brought against Royal Dutch Shell.

    In October, the world prepared without much enthusiasm for the long-awaited Glasgow gathering. We checked the temperature with a wide range of investors who wished for mobilising capital & net-zero targets and harmonising disclosures & international cooperation.

    The COP26 monopolised the headlines at the beginning of November and we provided a useful summary of both week 1 and week 2. And post-COP, we reported on investors’ mixed reaction. As announced earlier in the year, IFRS announced an institutional framework for sustainability disclosures. Also in the reporting arena, the Impact Management Project (IMP) graduated to the Impact Management Platform (IMP).

    In December, it was the turn of the to announce a net-zero roadmap and even NBIM endorsed net-zero targets. Just before Christmas, we reflected on the disappointment of those waiting for the EC to take a decision on the inclusion of gas and nuclear in the taxonomy.

     

    Aline Reichenberg Gustafsson, CFA
    Aline Reichenberg Gustafsson, CFA
    Aline Reichenberg Gustafsson, CFA is Editor-in-Chief for NordSIP and Managing Director for Big Green Tree Media. She has 18 years of experience in the asset management industry in Stockholm, London and Geneva, including as a long/short equity hedge fund portfolio manager, and buy-side analyst, but also as CFO and COO in several asset management firms. Aline holds an MBA from Harvard Business School and a License in Economic Sciences from the University of Geneva.

    Latest Posts

    NordSIP Insights Handbook

    What else is new?