Our fortnightly ‘Brief’ is intended to be a helpful reference point and resource for our network, providing an overview of activity in the Impact Economy. You won’t be surprised to see that we’ve taken a particular interest in legal and regulatory developments.
We hope you find the Brief to be a valuable digest of the things you need to know, and invite you to tell us what you’d like to read more about.
Talk the Talk
As the language of the Impact Economy develops, we’ll add relevant terminology to our Impact Economy Glossary, to help share a common understanding. This week’s jargon is:
“Theory of change”
If you only have 5 minutes of quiet this week, we recommend…
2020 & Sustainability: It’s Decision Time for Business Leaders. James Perry, co-Chairman for frozen food manufacturer and retailer COOK, writes for CEO Today magazine about how the new decade will be pivotal, with much depending on whether business leaders support the re-programming of business away from profit maximisation.
Microsoft will be carbon negative by 2030. In its official blog, Microsoft announced its plan to be carbon-negative by 2030 and to remove all carbon the company has emitted either directly or by electrical consumption since it was founded in 1975. For more, the BBC provided commentary on the announcement.
Event – B Corp Climate Collective: We’re taking action on the Climate Emergency. The B Corp Climate Collective is a group of Certified B Corporations working together to take action on the climate emergency. On 29 January it will be hosting a half-day open space on the development of the collective. You can register for the event.
Circulytics – measuring circularity is a new tool from the Ellen MacArthur Foundation, designed to be the most comprehensive circularity measurement tool for companies, to support transition towards a circular economy regardless of a company’s industry, complexity and size (press release).
A longer read – Procuring a Regenerative Economy is a new paper from Volans, and part of its Tomorrow’s Capitalism Inquiry, written in partnership with EcoVadis. The paper looks at what it will take to move to value-centred, circular models of procurement, and what businesses already engaging in regenerative procurement are doing. Volans provides narrative on this issue in its blog.
Video – B Inspired London 2019: Exploring the Future of Business. The B Corp UK YouTube channel has a playlist from October’s B Inspired conference, including sessions with The Body Shop’s International Director of Corporate Social Responsibility and Campaigns, Chris Davis, Prof. Colin Mayer of the University of Oxford, Divine Chocolate’s CEO, Sophi Tranchell, Bulb Co-founder and COO Amit Gudka, and Kajal Odedra, UK Director at Change.Org.
Citi Launches $150 Million Impact Investing Fund to make equity investments, from its own capital, into U.S.-based “double bottom line” companies that have a positive impact on society, with a particular focus on women and minority entrepreneurs.
Podcast – Blue like an Orange offers a report card for the Sustainable Development Goals. In this episode of Returns on Investment, former World Bank official and founder of Blue like an Orange Sustainable Capital, Bertrand Badré, discusses whether necessary changes in the financial system were given enough thought when the UN SDGs were adopted, and describes SDG Blue, an internal credit rating system that scores investments against the SDGs.
How do charities approach investing in line with their purpose and values? We want to know, and we want to help. The Charity Commission has published a blog stating that it is seeking feedback on trustees’ experiences of responsible investment, to identify the barriers to more widespread responsible investment and what could support trustees to invest to reflect their charities’ purposes and values. Responses will be received until 31 March 2020. For more, the Guardian reports on the announcement, including comments from Bates Wells’ Partner, Luke Fletcher.
BlackRock’s Larry Fink’s 2020 letter to CEOs has been covered in a number of publications, such as by Harvard Business School’s Mark Kramer in the Harvard Business Review, Michael Brune, Executive Director of the Sierra Club, on CNBC, and The New York Times.
A longer read – Technology Enabled Impact Reporting Practice Across the Investment Chain is a new report from the Impact Investing Institute and Deloitte looking at how technology could transform impact reporting, thereby enabling the capital market system to be transformed towards creating a sustainable future (press release and summary report).
Legal and Regulatory
Financial Reporting Council (FRC) – Annual Review of the UK Corporate Governance Code. The FRC has published its annual report into governance and reporting; it has reviewed reporting against the 2016 Code and assessed FTSE100 ‘early adopters’ of the revised 2018 Code. Whilst noting that the new approach of the 2018 Code has been generally accepted, the report calls for greater focus on the activities and outcomes of implementing its Principles. In particular, the report notes that many companies had not sufficiently met the reporting requirements relating to company purpose (press release).
European Green Deal:
- Sustainable Europe Investment Plan – European Green Deal Investment Plan. The European Commission has published a detailed plan for financing the European Green Deal, involving the EU, the national public sector and the private sector, which is expected to lead to at least €1 trillion of sustainable investments over the next decade and create an enabling framework for private investors and the public sector to facilitate sustainable investments.
- The Commission has also published a proposal for a Regulation of the European Parliament and Council establishing the Just Transition Fund. This will be one of three sources of funding for the EU’s ‘Just Transition Mechanism’, a tool for pursuing a fair transition to a climate-neutral economy, by providing support to mobilise at least €100 billion over 2021-2027 to alleviate the socio-economic impact of transition in the most affected regions.
- For more information, The European Green Deal Investment Plan and Just Transition Mechanism explained provides a detailed Q&A. (Commission press release and Parliament press release.)
Sustainable Development Goals Disclosure Recommendations. A group of global accountancy and disclosure bodies have published a new report aiming to establish best practice for corporate reporting on the SDGs, and enable more effective and standardised reporting and transparency on climate change, social and other environmental impacts. The work aligns to the International Integrated Reporting Framework, the Task Force on Climate-related Financial Disclosure, and the Global Reporting Initiative. (Press release).
Disclaimer – The information contained in this briefing is not intended to be a comprehensive update – it is our selection of third party reports, news, podcasts and other materials, as well as some content produced by Bates Wells where indicated as such which we think will be of interest to those working in the Impact Economy. This content is necessarily of a general nature; it does not constitute advice, and specific advice should always be sought for specific situations.
This information is necessarily of a general nature and doesn’t constitute legal advice. This is not a substitute for formal legal advice, given in the context of full information under an engagement with Bates Wells.
All content on this page is correct as of January 24, 2020.