May News Highlights

May News Highlights

8 June 2020

This month includes news from Borsa Italiana, BSE, BVC, B3, JPX, JSE, LuxSE, NSE and more. Monthly news highlights are compiled by the SSE to give an overview of the capital markets' sustainability news from that month. You can subscribe to our monthly news highlights by clicking here.

SSE INITIATIVE NEWS & EVENTS 

SSE Q2 2020 Quarterly Webinar May 2020 The SSE’s Q2 webinar was focused on stock exchange responses to the pandemic and the emergence of COVID-19 bonds. There were presentations from London Stock Exchange, Luxembourg Stock Exchange and the IFC. For more information on the discussions and participants check the Q2 2020 Quarterly Webinar summary page. Going Beyond the Balance Sheet: Disclosure and Transparency Webinar June 18, 2020, 12:30 Hong Kong Time (HKT) This webinar aims to help emerging market companies understand how to report better to investors and other key stakeholders. More information and registration here.  Digital Italian Sustainability Week 2020 From 29 June to 3 July, Borsa Italiana organizes the Italian Sustainability Week: during the event numerous video interviews of opinion leaders will be available on the Borsa Italiana website regarding strategic objectives and concrete actions, financing tools and approaches to sustainable investment. ESG metrics: Nasdaq ESG Footprint and S&P Global ESG Scores 19 May 2020 SSE started its campaign for ESG disclosure in September 2015, now our ESG Disclosure Guidance Database has 54 exchanges with written ESG Guidance. Two new services launched this month come from Nasdaq stock exchange and Standard and Poor’s.   JPX publishes Practical Handbook for ESG Disclosure in English May 2020 JPX announced the publication of the English version of its Practical Handbook for ESG Disclosure.   Exchange in Focus: Moscow Exchange advancing ESG 31 May 2020 Moscow Exchange has been taking significant steps towards development of responsible investing. It became an SSE Partner Exchange in 2019 and in the same year launched the daily tracking of Russia’s first sustainability indices as well as new MOEX’s listing rules providing for the creation of the Sustainability Sector.   

STOCK EXCHANGE NEWS

Nigerian Stock Exchange Hosted a Virtual Seminar On The Impact Of COVID-19 On Women In The Workplace 25 May 2020 NSE will also host a Sustainable Capital Markets Forum To Promote Green Finance In West Africa. The inaugural edition of the Webinar Series will be on “Fundamentals of Developing Green Bond Markets”. LuxSE launches LGX Academy to boost sustainable finance education 05 May 2020 The academy offers tailor-made lectures on a broad range of topics linked to sustainable finance, thereby allowing participants to enrich their knowledge in this field and gain a deeper understanding of sustainable finance market practices.  Building back better – Finance and development leaders in joint action 03 June 2020 Leila Fourie, CEO JSE participated in the discussions at a global on-line conference on how to build back better from Covid-19 pandemic through long-term investment in sustainable development. Ciclo de Conferencias en Economía, Finanzas y Sostenibilidad 03 June 2020 Bolsa de Valores de Colombia participated in the series of webinars organized by the Universidad Nacional de Colombia about sustainable finance.  BSE cuts annual listing fee on the BSE SME platforms by 25% 18 May 2020 The revised listing fee structure will be applicable for the existing companies as well as for all the firms awaiting to be listed on BSE. B3 will participate in a Webinar organized by CDP about Green Finance and Covid-19 recovery 10 June 2020 In Europe, there is already political support to link post-Covid-19 strategies to a green recovery plan, suggesting sustainable investments as a way out of this economic crisis. Would this be a viable agenda for Brazil? Bloomberg Webinar on Bloomberg Gender-Equality Index June 10, 2020 3:00 PM CEST Highlight Your Commitment to Gender Equality with the GEI. The webinar will overview of the Bloomberg Gender-Equality Index and discuss details on consideration for inclusion in the index. There will be an introduction to the GEI scorecard, which can help your company understand key focus areas for development. Registration here.   

REGULATOR NEWS

US SEC Provides Temporary, Conditional Relief To Allow Small Businesses To Pursue Expedited Crowdfunding Offerings 04 May 2020 The United States Securities and Exchange Commission announced that it is providing temporary, conditional relief for established smaller companies affected by COVID-19 that may look to meet their urgent funding needs through a Regulation Crowdfunding offering.  UAE Securities And Commodities Authority Obtains Certificate Of Conformity With ISO Standards On Sustainable Procurement 19 May 2020 SCA is the first federal authority to obtain certificates of conformity with ISO standards on governance and innovation and the first body in the country to obtain conformity certificates with the ISO standards related to knowledge and sustainable procurement.  United States SEC Urged To Take Global Lead In Requiring ESG Disclosures 21 May 2020 The United States Securities and Exchange Commission should take the global lead in mandating material ESG (Environmental, Social and Governance) disclosures, the SEC’s Investor Advisory Committee (IAC) urged today. If the SEC does not take the lead, it is highly likely that other jurisdictions will impose standards in the next few years that american issuers will be bound to follow, either directly or indirectly, due to the global nature of the flow of investment into the US markets, the panel said in a report. Hong Kong Regulators Establish Green and Sustainable Finance Steering Group 05 May 2020 The Steering Group aims to coordinate the management of climate and environmental risks to the financial sector, accelerate the growth of green and sustainable finance in Hong Kong and support the Government’s climate strategies

ESG INDICES AND PRODUCTS

Green bond slowdown seen as temporary 01 May 2020 Green bond issuance is down 9% so far this year compared with the first four months of 2019, but the drop is expected to be temporary as carbon reduction remains an urgent focus and green bonds could be used as a post-crisis economic stimulus. SZSE Releases New Themed Stock Indexes Including Public Health  11 May 2020 SZSE Public Health 50 Index (“Public Health 50”, Code 399277) is the first A-share index focusing on public health. Fifty SZSE-listed companies from relevant business fields such as disease control and prevention, material support and technology support were selected as samples.  BME Admits A 52 Million-Euros Health And Social Bond From The Madrid Region 29 May 2020 BME’s AIAF Fixed Income market admitted the first health and social bond to trading from a Spanish Public Administration to finance the fight against Covid-19. The bond was issued by the Madrid region and its value amounts to 52 million euros. Credit Suisse Makes Green-Bond Debut After Two-Year Wait 11 May 2020 Credit Suisse Group AG is set to price its first green bond, two years after outlining plans for a debut sale via a different part of the business. The Swiss bank’s London branch will issue the 500 million-euro ($540 million) five-year bond, after getting more then 2.8 billion euros of orders. Twitter, Walmart, Equifax and others dropped by S&P from its ESG index, while Costco is newly included 07 May 2020 S&P Global Inc. kicked out big-name companies and added others to its sustainable version of its bellwether S&P 500 index, a move that will impact a growing swath of investments tied to the benchmark.  End of Virus Panic Mode Revives Slumbering Green-Bond Market 15 May 2020 Europe’s green-bond sales are rebounding, after largely missing out on record-breaking credit binge fueled by coronavirus concerns. The recent pick-up suggests companies are moving beyond immediate coronavirus worries, as green bonds usually support long-term investments and they are of little use in a crisis due to restricted use of proceeds and lengthy preparation times. China green bond issuance rebounds after falling to lowest in over 3 years in Q1 17 May 2020 China's issuance of green bonds in the first quarter fell to the lowest level in more than three years amid the pandemic disruption, although the volume started recovering in April. In the first three months of 2020, China issued $2.32 billion worth of green bonds, less than a fifth of $13.06 billion in the previous quarter and about a third of $7.59 billion a year earlier, according to CBI.  LatAm green bond Q1 issuance holds up thanks to Chile 06 May 2020 Latin America's total green bond issuance in the first quarter of 2020 was nearly equal to the whole of last year. Moody's Investor's Service reported green bond issuance in the first quarter of the year at $4.3 billion, down from the $4.7 billion issued during the whole of 2019 in the region.  How Nordic Investment Bank’s Response Bond Is Helping Estonia During the Pandemic 12 May 2020 “Extraordinary times call for extraordinary measures,” said Angela Brusas, Director at Nordic Investment Bank. “NIB’s Response Bond is a way to directly channel investments toward alleviating the social and economic consequences of the pandemic.”

CONSULTATION

ESMA Consults On SME Growth Markets The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, has launched a consultation on the functioning of the Small and Medium-sized enterprises (SME) Growth Market regime in the European Union (EU) and on two draft technical standards, introduced by the amendments to the Market Abuse Regulation (MAR) for the promotion of the use of SME Growth Markets. ESMA will consider all comments received by 15 July 2020. 

RESEARCH 

S&P Global: Environmental, Social, And Governance: Islamic Finance And ESG: Sharia-Compliant Instruments Can Put The S In ESG 27 May 2020 COVID-19 has significantly slowed core Islamic finance economies because of their governments' measures to combat the spread of the virus. Unemployment rates will rise as some companies see significant revenue reduction. Islamic finance provides socially responsible products, and the current environment could offer the possibility to leverage them. Barrons: Future Returns: Social Factors Gain Stature in ESG Analysis 21 May 2020 As the Covid-19 crisis has unfolded, its effects on society have heightened attention on how companies are responding to their customers, workers, and their communities. For investors, this means focusing on the “S” in environmental, social, and governance (ESG) analysis.  IMF: Equity Investors Must Pay More Attention to Climate Change Physical Risk May 2020 As scientists warn that global warming will increase the frequency and severity of such extreme weather events, the IMF’s latest Global Financial Stability Report examines the impact of climate change physical risk (loss of life and property as well as disruptions to economic activity) on financial stability, and finds that equity investors might not be pricing these risks adequately.  Morgan Stanley: 7 Insights from Asset Owners on the Rise of Sustainable Investing  28 May 2020 The practice of investing in companies or funds that aim to achieve market-rate financial returns, while considering positive social or environmental impact, is gaining more popularity than ever before among institutional investors. World Economic Forum: Transformational Investment: Converting Global Systemic Risks into Sustainable Returns 28 May 2020 The WP provides new insights to ensure that the long-term impact of non-traditional risks and opportunities can be better understood. The report identifies six systemic risks and establishes a governance framework to enable the investment community to address risks related to water security, climate change, population growth, geopolitical uncertainty, negative interest rates and technology disruption. BlackRock: Sustainable investing: Resilience amid uncertainty 18 May 2020 The recent downturn was a key test of this conviction. In the first quarter of 2020, we have observed better risk-adjusted performance across sustainable products globally, with 94% of a globally-representative selection of widely-analyzed sustainable indices outperforming their parent benchmarks. While this short time period is not determinative, it aligns with the resilience we have seen in sustainable strategies during prior downturns. AIMA: AIMA issues EU sustainable finance guidelines 21 May 2020 Ahead of implementation of the EU's Sustainable Finance Action plan, AIMA says it has had many conversations with its members who have concerns about the SFDR compliance process. The guide has been produced with the concerns of alternative funds in mind and includes a compliance checklist and key dates (as they stand) and hopes to open up industry discussion on how to best adapt to the EU Taxonomy Regulation.

MANAGEMENT NEWS

HKEX Re-appointment of Chairman Approved 19 May 2020 Reference is made to the announcement of Hong Kong Exchanges and Clearing Limited (“HKEX”) dated 7 May 2020 in relation to the re-appointment of Mrs Laura May-Lung Cha (“Mrs Cha”) as the Chairman of the Board of Directors of HKEX (“Chairman”) SEC Announces New Investor Advisory Committee Members 15 May 2020 The US Securities and Exchange Commission today announced the appointment of six new members to its Investor Advisory Committee.  Borsa Italiana: new board of directors, Jerusalmi confirmed to and Sironi as president 14 May 2020 The Board of Directors of Borsa Italiana has been renewed for the three-year period 2020-2022. Andrea Sironi President, Claudia Parzani Vice President and Raffaele Jerusalmi Chief Executive Officer confirmed.  Citigroup Launches New ESG Investment Banking Group 19 May 2020 Citigroup Inc is launching a new business unit within its corporate and investment bank dedicated to environmental sustainability to strengthen its commitment to an area that has grown increasingly important to corporate clients and investors. "The current Covid crisis will elevate the importance of ESG to our clients, as they increasingly focus on more sustainable and resilient strategies and on recovery plans that help drive the just transition to a net-zero emissions future," global BCMA heads Tyler Dickson and Manolo Falcó said in a memo to bankers.

COVID-19 & SUSTAINABLE RECOVERY 

European Green Deal Marches Forward 19 May 2020 The coronavirus hasn’t knocked off course the European Commission's plans to push forward with its Sustainable Finance Action Plan. In addition to many new developments on individual subcomponents of the plan, the European Commission has also initiated work on a Renewed Sustainable Finance Strategy. This policy strategy aims to provide financial systems the tools needed to transition to the standards outlined by the EU Green Deal. The Green Deal presents a vision for a climate-neutral continent by 2050 and a road map to get there, which includes 50 actions to take by 2050.  World Economic Forum: IMF leader says pandemic stimulus must focus on battling climate crisis 30 April 2020 IMF Managing Director, Kristalina Georgieva, calls for fiscal responses to coronavirus to also tackle climate change. Green incentives could include green bonds and other forms of sustainable finance. The IMF estimates that a low-carbon transition would require $2.3 trillion in investment every year for a decade. The Economist: Can covid help flatten the climate curve? 21 May 2020 Amid covid-19’s sweeping devastation, its effect on greenhouse gases has emerged as something of a bright spot. Between January and March demand for coal dropped by 8% and oil by 5%, compared with the same period in 2019. By the end of the year energy demand may be 6% down overall, according to the International Energy Agency (iea), an intergovernmental forecaster, amounting to the largest drop it has ever seen. McKinsey: Addressing climate change in a post-pandemic world 7 April 2020 Given the scope and magnitude of this sudden crisis, and the long shadow it will cast, can the world afford to pay attention to climate change and the broader sustainability agenda at this time? Not only does climate action remain critical over the next decade, but investments in climate-resilient infrastructure and the transition to a lower-carbon future can drive significant near-term job creation while increasing economic and environmental resiliency.  S&P Global: The Essential Podcast, Episode 9: The Shrinking Time Horizon – ESG in the Time of COVID-19 15 May 2020 Reid Steadman, Head of ESG Indices at S&P Dow Jones Indices, joins The Essential Podcast to discuss the role of ESG in the midst of the global pandemic and a major economic slowdown. He explains how the experience of the lockdown may prepare us for further action on ESG and what the ESG market can do to expand its reach and appeal. Forbes: Covid-19 Is Accelerating ESG Investing And Corporate Sustainability Practices 19 May 2020 Sustainable investing – the integration of environmental, social and governance (ESG) factors into analysis and decision making - has seen a remarkable rise over the past couple of years. Starting from modest levels 15 years ago, it is now estimated at over US$ 30 trillion. So far, the outbreak of the Covid-19 virus has not stopped the growth of ESG investing, which has seen a steady increase in inflows and better-than-average returns since the start of the pandemic.   

About the SSE

​The SSE initiative is a UN Partnership Programme organised by UNCTAD, the UN Global Compact, UNEP FI and the PRI. The SSE’s mission is to provide a global platform for exploring how exchanges, in collaboration with investors, companies (issuers), regulators, policymakers and relevant international organizations, can enhance performance on ESG (environmental, social and corporate governance) issues and encourage sustainable investment, including the financing of the UN Sustainable Development Goals. The SSE seeks to achieve this mission through an integrated programme of conducting evidence-based policy analysis, facilitating a network and forum for multi-stakeholder consensus-building, and providing technical assistance and advisory services.