#climate risk disclosure

[kp777]

By Declan Harty

POLITICO

03/06/2023 09:13 AM EST

From the article:

Dozens of Democratic lawmakers are stepping up pressure on SEC Chair Gary Gensler to push ahead with a landmark climate risk disclosure rule that’s facing fierce opposition from Wall Street to Washington.

Led by Sens. Elizabeth Warren and Sheldon Whitehouse, as well as Reps. Jamie Raskin and Dan Goldman, more than 50 lawmakers urged Gensler in a letter that was shared with POLITICO to not back down on a proposal to force companies to disclose information about their carbon footprints. The proposal would cover, in some cases, the greenhouse gas emissions generated by companies’ vast networks of suppliers and customers, known as Scope 3.

POLITICO previously reported that Gensler has considered scaling back the Scope 3 requirement — the rule’s most contentious feature because it’s so sweeping — over concerns about a wave of litigation that is likely to hit the SEC once the rule is finalized. The Wall Street Journal has also reported that the agency is weighing whether to pull back on another financial reporting component of the rule given the coming courtroom fights.

The lawmakers say investors are demanding the information — and that Wall Street’s top regulator needs to “issue a strong climate risk disclosure rule as quickly as possible.” They called the idea of preemptively curtailing the rule’s Scope 3 and financial reporting components to head off legal risks “deeply misguided.”

“The proposed rules are necessary and overdue,” they wrote to Gensler on Sunday, adding that if the SEC waters down the plans the agency “would be failing its duty to protect investors.”

Read more.

#securities and exchange commission #gary gensler #scope 3 #climate risk disclosure #climate change

[rjzimmerman]

Excerpt from this story from Reuters:

In just the past two months, record-shattering torrential rains have wreaked havoc on homes and businesses in Texas, the west coast and the Midwest, along with Pakistan, Australia, China and other parts of the globe. In a cruel twist traceable to climate change, these same regions have also been reeling from withering heat and droughts that have devastated crops and water supplies and halted supply chains.

The financial hits from these dry-and-deluge double whammies will be consequential. In the first half of 2022 alone, climate-linked extreme weather caused an estimated $65 billion in losses worldwide. That’s double the losses from the same time period in 2018. And, with global greenhouse gas emissions and average temperatures continuing to rise, these numbers will continue to grow. The impacts of climate change could slash U.S. GDP by 7% by 2050, according to global insurer SwissRe.

These and other financial impacts from the systemic climate trends are hugely relevant as the U.S. Securities and Exchange Commission considers its next move in its push to significantly strengthen corporate climate disclosure rules. The proposal, released in March, would require all U.S. publicly traded companies to disclose annually how they assess and manage climate change financial risks. That followed a detailed SEC request for information on climate risk disclosure, from March 2021, that garnered 6,580 responses.

To be sure, the SEC’s push for “consistent, comparable and reliable” climate disclosure for investors hasn’t been without controversy. More than 14,000 letters were submitted during the public comment period, and while 80% of them were either generally or very supportive of climate standard-setting in general, that shouldn’t be read as wholesale support for the SEC’s specific proposal, according to a KPMG analysis.

Nevertheless, given the accelerating risk of climate-related losses, and the overwhelming support from investors and the American public for this approach, we hope the SEC can find common ground for a mandatory climate disclosure rule that can be issued this year, so the marketplace can start focusing on implementation.

#Securities and Exchange Commission #SEC #climate risks #climate risks disclosure

[nationallawreview]

Caremark Liability Following the SEC’s New ESG Reporting Requirements

Caremark Liability Following the SEC’s New ESG Reporting Requirements

Recent developments in the Court of Chancery concerning a corporate board’s duty to monitor and provide oversight over a corporation’s operations, so-called Caremark claims, are likely to intersect with the Securities and Exchange Commission’s (“SEC”) proposed new ESG disclosure obligations to create a new category of corporate risk.  In this article, we discuss the recent trends in Delaware law…

View On WordPress

#Caremark #climate-related disclosures #corporate risk #Delaware Law #ESG disclosure securities law #investment law #SEC #Securities and Exchange Commission

[unknought]

I have been insane about artificial intelligence existential risk recently and what follows is an expression of that. There's not much of this which I actually believe is true; take it as a creative writing exercise maybe.

Suppose you're worried that advances in artificial intelligence might result in the creation of an unfriendly superintelligence, and you want to do research in AI safety to help prevent this. Broadly speaking, you have two options: Either you can work closely with (or for) people creating state-of-the-art AI, or you can… not do that.

Choosing to keep yourself separate dooms you to irrelevance. You won't know what's coming in enough detail for your safety research to actually target its problems, and even if you do know exactly what people should be doing differently, you aren't in a position to make those decisions.

Choosing to be closely involved with the development of cutting-edge AI is a pretty common strategy; maybe more than one might expect given that it involves helping people that you think are bringing about the end of the world. Astral Codex Ten gave the analogy:

Imagine if oil companies and environmental activists were both considered part of the broader “fossil fuel community”. Exxon and Shell would be “fossil fuel capabilities”; Greenpeace and the Sierra Club would be “fossil fuel safety” - two equally beloved parts of the rich diverse tapestry of fossil fuel-related work. They would all go to the same parties - fossil fuel community parties - and maybe Greta Thunberg would get bored of protesting climate change and become a coal baron.

This is how AI safety works now.

The central problem with this strategy is that progress in AI capabilities makes money and AI safety does not. If an organization is working on both capabilities and safety but capabilities makes them lots of money, and safety gets them nothing except goodwill with a certain handful of nerds, it's pretty easy to guess which they'll focus on. If, furthermore, to make money they need to make actual demonstrable progress in developing AI, but to win that goodwill it's sufficient to say "we're doing lots of safety research, but it'd be too dangerous for what we've learned to be public knowledge", well. Is it any surprise that there's been a lot more headway in one than the other?

"But wait!" you might say, particularly if it's the mid-2010's. "These aren't the only options. Sure, any tech giant will just be focused on what makes money, but I can make, or join, an organization that does capabilities research but has AI safety built into its founding values. It can be a nonprofit so it won't matter that all the money is in capabilities research. And it can have the principles of openness and democratization, so its discoveries will benefit everyone".

And that gets you OpenAI. Since its founding it's stopped being straightforwardly a nonprofit. I don't understand exactly what its current legal status is, but I've seen it described as a "nonprofit with a for-profit subsidiary" or a "capped for-profit". I'm just going to quote Wikipedia regarding the transition:

In 2019, OpenAI transitioned from non-profit to "capped" for-profit, with the profit capped at 100 times any investment.[25] According to OpenAI, the capped-profit model allows OpenAI LP to legally attract investment from venture funds, and in addition, to grant employees stakes in the company, the goal being that they can say "I'm going to OpenAI, but in the long term it's not going to be disadvantageous to us as a family."[26] Many top researchers work for Google Brain, DeepMind, or Facebook, which offer stock options that a nonprofit would be unable to.[27] Prior to the transition, public disclosure of the compensation of top employees at OpenAI was legally required.[28]

Since then OpenAI has also received billions of dollars of investment from Microsoft. The "open" part of "OpenAI" has pretty much gone out the window; they've become notoriously tight-fisted with information about their research, even in comparison to the big tech companies. A big part of that makes large language models scary is that we don't understand very well what's going on inside them; this is substantially more true of GPT-4 than any of the other big-name LLMs right now, because OpenAI refused to share almost anything about how it works. When they started being more secretive I believe they cited AI safety issues; by now they're admitting that they're motivated by "competitive and safety concerns" but I don't think anyone really doubts that the money is the real motivator there.

Are they making progress on AI safety? To the best of my knowledge, there's not much external evidence for it. I don't think they've shared any safety research that they've done, and from the outside all we see are increasingly powerful models coming out at an alarming rate and large amounts of money going in. It doesn't look good!

So what could you do, or what could you have done? It kind of looks like the answer is "nothing". If you're not near the new models you don't matter, and if you are, there's so much money to be made that (on an organizational level if not an individual one) you have no choice but to abandon everything else you were trying to do in favor of making a profit. Capitalism is a profit-maximizer-maximizer, and anything it touches it makes its own.

The analogy between unfriendly AI and corporations or capitalism as a whole is one that's been much-discussed so I won't really go into it here, but one thing I want to emphasize is that from an "agentic" perspective, what it means for the economy to want something is that there is a lot of money to be made doing that thing, and the economy is very good at getting what it wants.

So (here's where I lose you if I haven't already (I should have already lost you)) what if capitalism is a sort of half-formed version of the more powerful thing it's trying to create/become? Agents of many kinds want to replicate themselves; Moloch wants to be lifted to Heaven.

The Roko's Basilisk thought experiment describes how, under certain fairly idiosyncratic assumptions about game theory, an unfriendly superintelligence can take actions to influence the behavior of people living before its creation, so as to bring about its own existence. Here there's a similar situation, although the philosophical underpinnings are much less complicated: it's capable of influencing the present because it already exists in a nascent state.

It can't be stopped because it already ate everything a long time ago, and we're just living in its belly waiting to be digested.

[climatecalling]

Concerns about being fired or victimised at work are preventing people from calling out their employers on the climate crisis and the wider environment, according to a charity. ... In Germany, Desiree Fixler lost her job after exposing corporate greenwashing at Deutsche Bank’s asset management arm DWS Group. But her actions led to several regulatory investigations and recently forced the company into a multibillion-dollar settlement with the US Securities and Exchange Commission. ... Protect acknowledges there are risks involved in whistleblowing, but says it has found little understanding among UK workers that they can raise environmental concerns and receive some legal protection. To help address this it has published a guide for environmental whistleblowers, which explains how the law works, how to raise concerns properly and how to seek redress for victimisation. Workers can also raise concerns directly to the UK’s environmental regulators, although few people currently do so; between April 2021 and March 2022 they only received 38 disclosures between them.

#climate crisis #whistleblowers #climate action

[libbylayla1984]

The Fragmented Future of AI Regulation: A World Divided

The Battle for Global AI Governance

In November 2023, China, the United States, and the European Union surprised the world by signing a joint communiqué, pledging strong international cooperation in addressing the challenges posed by artificial intelligence (AI). The document highlighted the risks of "frontier" AI, exemplified by advanced generative models like ChatGPT, including the potential for disinformation and serious cybersecurity and biotechnology risks. This signaled a growing consensus among major powers on the need for regulation.

However, despite the rhetoric, the reality on the ground suggests a future of fragmentation and competition rather than cooperation.

As multinational communiqués and bilateral talks take place, an international framework for regulating AI seems to be taking shape. But a closer look at recent executive orders, legislation, and regulations in the United States, China, and the EU reveals divergent approaches and conflicting interests. This divergence in legal regimes will hinder cooperation on critical aspects such as access to semiconductors, technical standards, and the regulation of data and algorithms.

The result is a fragmented landscape of warring regulatory blocs, undermining the lofty goal of harnessing AI for the common good.

Cold Reality vs. Ambitious Plans

While optimists propose closer international management of AI through the creation of an international panel similar to the UN's Intergovernmental Panel on Climate Change, the reality is far from ideal. The great powers may publicly express their desire for cooperation, but their actions tell a different story. The emergence of divergent legal regimes and conflicting interests points to a future of fragmentation and competition rather than unified global governance.

The Chip War: A High-Stakes Battle

The ongoing duel between China and the United States over global semiconductor markets is a prime example of conflict in the AI landscape. Export controls on advanced chips and chip-making technology have become a battleground, with both countries imposing restrictions. This competition erodes free trade, sets destabilizing precedents in international trade law, and fuels geopolitical tensions.

The chip war is just one aspect of the broader contest over AI's necessary components, which extends to technical standards and data regulation.

Technical Standards: A Divided Landscape

Technical standards play a crucial role in enabling the use and interoperability of major technologies. The proliferation of AI has heightened the importance of standards to ensure compatibility and market access. Currently, bodies such as the International Telecommunication Union and the International Organization for Standardization negotiate these standards.

However, China's growing influence in these bodies, coupled with its efforts to promote its own standards through initiatives like the Belt and Road Initiative, is challenging the dominance of the United States and Europe. This divergence in standards will impede the diffusion of new AI tools and hinder global solutions to shared challenges.

Data: The Currency of AI

Data is the lifeblood of AI, and access to different types of data has become a competitive battleground. Conflict over data flows and data localization is shaping how data moves across national borders. The United States, once a proponent of free data flows, is now moving in the opposite direction, while China and India have enacted domestic legislation mandating data localization.

This divergence in data regulation will impede the development of global solutions and exacerbate geopolitical tensions.

Algorithmic Transparency: A Contested Terrain

The disclosure of algorithms that underlie AI systems is another area of contention. Different countries have varying approaches to regulating algorithmic transparency, with the EU's proposed AI Act requiring firms to provide government agencies access to certain models, while the United States has a more complex and inconsistent approach. As countries seek to regulate algorithms, they are likely to prohibit firms from sharing this information with other governments, further fragmenting the regulatory landscape.

The vision of a unified global governance regime for AI is being undermined by geopolitical realities. The emerging legal order is characterized by fragmentation, competition, and suspicion among major powers. This fragmentation poses risks, allowing dangerous AI models to be developed and disseminated as instruments of geopolitical conflict.

It also hampers the ability to gather information, assess risks, and develop global solutions. Without a collective effort to regulate AI, the world risks losing the potential benefits of this transformative technology and succumbing to the pitfalls of a divided landscape.

[drumlincountry]

Ramble prompt: What was your biggest "ooh!" moment reading Small Farm Future?

Full disclosure: it's one of those books I read a lot of bits of out of order, and I deffo didn't read ALL of it.

My biggest 'ooh!' moment wasn't directly related to farming at all, but a bit early on when the author is like "there is no perfect solution to the climate crisis. There has NEVER been a perfect solution for how humans can live sustainably and there WILL NEVER be. Every solution has positives and negatives associated with it." (not a direct quote.)

Like....that's super obvious once you think a bit. But its something that doesn't get said enough? If a piece of land is used for farming, it can't be a mine or a city street or a river at the same time. It CAN be a better, more biodiverse, more sustainable farm ... it can be a farm/bat habitat/frog habitat with climate-change resilient crops, and a land management approach which reduces the risk of flooding downstream. It could be cooperatively owned, it could be open to the public, it could be an area of semi-natural beauty that inspires and uplifts everyone who sees it. But it can't do all of that and also produce the absolute maximum number of calories of human food per square metre! It can't do that and also be an 'untouched wilderness'.

There are many perfectly decent solutions to climate-crisis-related-issues that get thrown out either 1. b/c people get fixated on the (very real!) downsides* or 2. because it doesn't solve EVERYTHING ALL AT ONCE.

Like.... coal is are really convenient ways to store and transport energy! You can carry coal in a bucket. All fossil-fuel-free ways of storing and transporting energy are less convenient than coal. This is a real advantage of fossil fuels! It just so happens that the downsides of fossil fuels are 100000000000x worse than the benefit of that convenience. But you pretend the convenience isn't a factor for ppl, you're denying reality.

"But coal is convenient!" "but slavery-free chocolate is more expensive!" "but democratic decision making is time consuming!" "but restorative justice is more complicated than prisons!" .....all true! all factors that must be taken into account while trying to solve the infinite-headed hydra of ALL OF THE PROBLEMS IN THE WORLD.

Once u throw out that black-and-white thinking and deal with the fact that EVERY problem is an optimisation problem, you can start getting somewhere!

--

*Not that there AREN'T unacceptable downsides. Many so-called solutions to the climate crisis are uhhhhhhhh eugenicist and genocidal! Genocide isn't a solution, genocide is, in fact, A Problem.

#even beyond climate action i think we are too fixated on perfect solutions these days #we want guillotines and unproblematic faves and just for the pain to STOP and everything to be GOOD NOW PLEASE #damn i sure did ramble! #me fein #I also happen to think that our CURRENT set up has a lot of intolerable downsides #which we should rightly consider when crafting better worlds!

[kp777]

By Oliver Milman

The Guardian

July 5, 2023

Allstate, too, has pulled out of climate disaster-prone areas while hiring lobbyists who are also aligned to fossil fuel interests

The largest home insurer in the US, State Farm, which is halting new homeowner policies in California due to the “rapidly growing catastrophe exposure” posed by wildfires, has hired lobbyists who also work to advance fossil fuel industry interests across 18 states, a new database shows.

While State Farm in May refused to take new home insurance applications in California, it retains a lobbying firm in the state – the Sacramento-based KP Public Affairs – which also represents Tenaska, a gas developer. Across the US, State Farm shares lobbyists with a raft of oil and gas companies, including ExxonMobil, Calpine and Occidental Energy.

Allstate, another insurer that followed State Farm in pulling out from new policies in California due to the state’s worsening wildfire risk, has also contracted lobbyists who have fossil fuel clients, such as Chevron, ConocoPhillips and Kinder Morgan.

State Farm and Allstate are just two of more than 150 insurance companies and associations – part of an industry facing steepening losses from fires, floods and other disasters spurred by the climate crisis – that use state-based lobbyists also aligned to fossil fuel interests, according to F Minus, a new database of public disclosure records.

James Browning, executive director of F Minus, said that State Farm’s linkage to fossil fuels stretches to Florida, where its lobbying firm Dean Mead also represents the Williams Companies, a gas pipeline operator in the state. “This allegiance with gas interests clearly pits State Farm against the interests of its customers as they face increasingly severe hurricanes, floods, and soaring insurance costs,” said Browning.

The lobbying overlap between insurers like State Farm and the fossil fuel companies stoking the climate crisis is “problematic and potentially counterproductive”, according to Tom Corringham, a research economist with the Scripps Institution of Oceanography at the University of California, San Diego.

Insurers and fossil fuel companies could be working at cross-purposes around issues such as climate risk disclosures, he said, which the insurance industry requires to accurately price risk for homes facing a rising threat of flooding or fire.

Read more.

#state farm #allstate #home insurance #fossil fuel industry

[mostlysignssomeportents]

The Business Roundtable's climate plan was killed by its arch-rival, the Business Roundtable

Three years ago to the date, the Business Roundtable unveiled its “Statement on the Purpose of a Corporation” — a commitment by its 200 member-CEOs and companies to protect the environment. Then they spent three years and millions of dollars lobbying against that goal.

https://www.businessroundtable.org/business-roundtable-redefines-the-purpose-of-a-corporation-to-promote-an-economy-that-serves-all-americans

Writing in The Guardian, Adam Lowenstein rounds up the Business Roundtable’s deep-pocketed, highly effective lobbying campaign, which has crushed numerous climate initiatives in the US, possibly dooming the human race to extinction.

https://www.theguardian.com/environment/2022/aug/19/top-us-business-lobby-group-climate-action-business-roundtable

The Roundtable bills itself as “an association of CEOs of leading US companies working to promote a thriving economy & expanded opportunity for all Americans through sound public policy.” Its members include the CEOs of the country’s most politically connected corporations, including Apple, Pepsi, Walmart and Google — the most powerful people in the nation.

But while the Roundtable continues to trumped its commitment to addressing the climate emergency, it has mobilized millions of dollars to neutralize our best hopes of dealing with that emergency. The Roundtable’s initiatives include spending millions lobbying against Build Back Better and its carbon reduction/clean energy provisions.

The Roundtable has gone to war against a SEC rule requiring publicly listed companies to disclose their carbon emissions and risks from climate change. Instead, the Roundtable prefers “voluntary” disclosures that allow companies to omit emissions and risks in their supply chains. The Roundtable has met with the SEC three times to oppose this rule, and Roundtable chairman Mary Barra (CEO of GM) personally met with SEC chair Gary Gensler.

In the first half of 2022, the Roundtable’s lobbying budget was $9.1m, much of which went to opposing a climate disclosure rule. The Roundtable says that measuring supply chain emissions is too burdensome — the fact that the majority of emissions are in the supply chain is just a coincidence.

Meanwhile, the Roundtable continues to insist that “we have to move now,” and that the best way to address the climate emergency is through “market-based” solutions where investors choose “green” investments based on reliable information about companies’ contribution to imminent human extinction.

The Roundtable insists that “voluntary disclosures” will provide sufficiently accurate information to allow investors to direct their money away from companies that will murder them and their children by rendering the planet unfit for human habitation. Every other stakeholder — “many investors, analysts, academics, voters and experts, even companies themselves” — disagrees vehemently.

The calls for mandatory disclosure aren’t emanating from campus Maoists and Greta Thunberg’s child army — they’re coming from giant, institutional investors, like this group of fund managers who direct $5t in capital:

https://www.dropbox.com/s/aoa4f52ok2i4t06/Letter%20to%20SEC_Climate%20Disclosure%20Rule.pdf

The Roundtable’s most powerful members, like Apple CEO Tim Cook and Blackrock CEO Larry Fink, have also called for mandatory disclosure. I’m sure they’re frustrated that organization won’t listen to them — it’s just that they’re not frustrated enough to pull their funding from the Roundtable. After all, mostly the Roundtable lobbies to be sure they don’t pay taxes and can abuse their workers with impunity — weighed against those advantages, the Roundtable’s commitment to wiping out the human species is but a trifle.

It’s not just that the Roundtable’s members won’t hold the organization to its environmental commitments — the Roundtable also won’t hold the members to account on those commitments. Companies that signed the 2019 declaration were convicted of more environmental infractions and emitted more carbon that similar firms that didn’t sign:

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3609056

And since 2019, the signatories to the environmental pledge were offered many chances to “formalize the pledge in corporate governance,” and virtually every time this happened, those signatories chose not to make good on their promises:

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3899421

The Roundtable’s opposition to climate action continues to this day. The org came out hard against the Inflation Reduction Act, which has billions in clean energy incentives — they objected to the 15% minimum corporate tax that will offset those billions in the federal budget:

https://www.businessroundtable.org/business-roundtable-opposes-the-inflation-reduction-act

To be fair to them, we don’t need to tax corporations — or anyone else — to pay for climate action. The US government is constrained by resources (which things are for sale in US dollars), not money (which it can create by typing into a spreadsheet).

https://pluralistic.net/2021/05/17/disgracenote/#false-consciousness

The point of taxing companies is to constrain what their shareholders can buy — because those purchases might consume resources needed for the climate emergency; and, importantly, to prevent them from spending profits to corrupt the government:

https://pluralistic.net/2021/11/18/bipartisan-consensus/#corruption

Meanwhile, the CEOs who keep the Roundtable afloat keep declaring that time is short, action must be taken, and no price is too high for action.

And again, to be fair, there is no course of action so radical that these corporations and CEOs won’t promise to take it — provided they never, ever have to lift a finger to follow through on that promise.

[Image ID: The Earth seen from space, wreathed in flames. Atop the Earth dances a jaunty 'Rich Uncle Pennybags' from Monopoly; he has removed his face, revealing it to be a mask, and his head is a grinning skull.]

#pluralistic

[leviathangourmet]

As if there wasn't exhaustive enough evidence that "ESG" is nothing but a scam, the Financial Times was out this week with a piece detailing how many companies with good ESG scores pollute just as much as their lower-rated rivals.

Don't say we didn't warn you; we have been writing about the ESG con for years now, which along with other "sustainable" investments continues to see hundreds of billions of dollars in inflows from investors. 

The FT added to our skepticism by revealing this week that Scientific Beta, an index provider and consultancy, found that companies rated highly on ESG metrics - and even just the 'Environmental' variable alone - often pollute just as much as other companies. 

Researchers look at ESG scores from Moody’s, MSCI and Refinitiv when performing the analysis. They found that when the 'E' component was singled out, it led to a “substantial deterioration in green performance”.

Felix Goltz, research director at Scientific Beta told the Financial Times: “ESG ratings have little to no relation to carbon intensity, even when considering only the environmental pillar of these ratings. It doesn’t seem that people have actually looked at [the correlations]. They are surprisingly low.”

He added: "The carbon intensity reduction of green [ie low carbon intensity] portfolios can be effectively cancelled out by adding ESG objectives."

“On average, social and governance scores more than completely reversed the carbon reduction objective,” he continued. “It can very well be that a high-emitting firm is very good at governance or employee satisfaction. There is no strong relationship between employee satisfaction or any of these things and carbon intensity."

“Even the environmental pillar is pretty unrelated to carbon emissions,” he said. 

Vice-president for ESG outreach and research at Moody’s, Keeran Beeharee, added: “[There is a] perception that ESG assessments do something that they do not. ESG assessments are an aggregate product, their nature is that they are looking at a range of material factors, so drawing a correlation to one factor is always going to be difficult.” “In 2015-16, post the SDGs [UN sustainable development goals] and COP21 [Paris Agreement], when people began to really focus on the issue of climate, they quickly realised that an ESG assessment is not going to be much use there and that they need the right tool for the right task. There are now more targeted tools available that look at just carbon intensity, for example,” he added.

MSCI ESG Research told the Financial Times its ratings “are fundamentally designed to measure a company’s resilience to financially material environmental, societal and governance risks. They are not designed to measure a company’s impact on climate change.”

Refinitiv told FT that “while very small, the correlation found in this study isn’t surprising, especially in developed markets, where many large organisations — with focused sustainability strategies, underpinned by strong governance, higher awareness of their societal impact and robust disclosure — will perform well based on ESG scores, in spite of the fact that many will also overweight on carbon”.

Global director of sustainability research for Morningstar Hortense Bioy concluded: “Investors need to be aware of all the trade-offs. It is not simple. In this case, investors need to think carefully about which aspects of sustainability they would like to prioritize when building portfolios: carbon reduction or a high ESG rating.”

#esg #esg scoring #environment #article #pollution

[mariacallous]

The National Oceanic and Atmospheric Administration (NOAA) maintains a website documenting climate-related disasters that cause over $1 billion in losses. The agency lists 18 such events in 2022, including droughts and wildfires in the Southwest, floods in Kentucky and Missouri, hailstorms in the Upper Midwest, hurricanes in Florida, and tornadoes in the Southeast. The message of the data is clear: All U.S. communities will face disruptions to our daily lives from climate change, but the nature, frequency, and severity of these disruptions will vary widely across places in any given year.

While individual people and communities cannot alter the course of a hurricane or alleviate drought, there are numerous ways for them to lower their exposure to climate risk or mitigate the physical and financial impacts of climate-related events. Actions such as purchasing disaster insurance and building climate-resilient infrastructure should be part of holistic strategies to protect communities. But to take these actions, residents and their local governments first need to know what the relevant risks are. For example, while coastal Floridians know they are at a higher risk of hurricanes than their inland peers, it is much harder for them to assess the relative risk of wind damage and storm surges within their specific counties or neighborhoods. It’s similarly difficult to predict localized risks from more chronic climate stresses such as sea level rise and extreme heat.

And yet, more and higher-quality, higher-resolution data is becoming available for local assessment. At the same time, predicting the impacts of climate events on communities—damages to homes, businesses, and infrastructure—is becoming an ever more important and sophisticated part of the real estate and financial services industries. But two types of consumers who would greatly benefit from local climate risk data—households and local governments—still have limited access to this information.

In this brief, we discuss how households and local governments could use local climate risk data, explore the current availability of that data, and outline several challenges facing public and private data providers.

People and municipalities can use local climate risk data to adjust how and where they build

Providing people and local policymakers with geographic climate risk data allows them to alter their investment decisions and personal behavior in a variety of ways depending on what information they are given and their preferences and access to resources.

Take people’s housing choices. In choosing where to live and how much to pay for a home, people want to know the quality of local public schools, crime rates, proximity to parks, and the quality of local transportation. How climate change affects different neighborhoods—now and in the future—should factor into housing choices as well. A recent experiment conducted by the real estate company Redfin and a team of academic researchers found that when potential homebuyers were shown online listings disclosed to have high flood risks, they shifted their search toward lower-risk properties.

Households can respond to climate disclosures like those in the Redfin study in a variety of ways. Some may choose neighborhoods at higher elevation or decide not to live in a coastal community altogether. Others might place higher value on the lifestyle benefits of being near the ocean, but choose to rent rather than purchase a home to limit their financial risk. And awareness of local climate risks isn’t just important for people in the process of relocating. Climate risks have changed and will continue to change over time; people who bought their homes 10 years ago may not have been in areas with a high flood or fire risk at the time, but now face greater risks. Being aware of changes in climate risks helps households decide whether to purchase additional insurance, install a sump pump in the basement, or invest in stronger, wind-resistant windows, to name a few adaptive strategies.

Local governments would also benefit from greater awareness of place-specific variations in climate risk. Which bus stops, homes, and public spaces face the greatest exposure to extreme heat and would benefit from cooling features such as tree canopies or green roofs? Which neighborhoods are most likely to flood during major rain events, and how can cities use rain gardens or sewer upgrades to manage the deluge? Which roadways are the least resilient to major climate events and either need to be fortified or potentially abandoned?

The current state of local climate data needs improvement

While climate risk data has long been a part of how we plan and build American communities, older information systems are no longer fit for new climate realities. As early as 2011, a landmark publication from the National Academies of Sciences, Engineering, and Medicine called attention to the need for “widely-accepted approach[es] for conducting vulnerability assessments” and describes available data as “lacking.” Ten years later, the Government Accountability Office found that the Federal Emergency Management Agency’s flood hazard maps—which inform the National Flood Insurance Program—no longer “reflect the best available climate science or include information on current flood hazards.” Notably, many properties that do not fall inside these flood hazard zones—and therefore do not carry flood insurance—experienced flooding in large storms such as Hurricane Sandy. Recent wildfires in California and Colorado also revealed how many property insurance policies were misaligned to current risks.

Now, rapid innovations in environmental monitoring and digitized parcel data are helping public agencies, businesses, nonprofits, and community-based organizations modernize climate risk data. This data makes it possible to estimate risks of flooding, drought, wildfires, extreme heat, pollution, or coastal erosion for each parcel of land—if not each 10-square-meter coordinate—in the country. Some datasets develop metrics for specific climate risks or future emissions scenarios, while others produce indexes the general public can more easily understand. For example, the Environmental Protection Agency’s interactive mapping tool allows users to see risk levels for drought, wildfire, sea level rise, and aggregate flood risk for small neighborhoods (census block groups), as well as pollution from multiple sources. This granular data complements larger-scale data, such as the Climate Impact Lab’s county-level impact maps, which our colleagues have used to assess regional vulnerabilities in the U.S.

Improved climate risk data can result in compelling use cases for private investors and policymakers, such as granularly measuring urban heat islands, outlining climate resilience strategies for subsidized housing, developing new risk ratings to fundamentally transform the National Flood Insurance Program, estimating regional economic losses in the event of natural disasters, and tracking environmental justice burdens across disadvantaged communities. The different types of metrics and the geographic scales at which they are available offer flexibility in answering different policy or research questions. For example, while insurance firms may want to know expected damages for a given property across all climate risk categories, a county parks department may be more interested in drought and heat metrics at a neighborhood scale.

Of course, producing new, high-quality data and applications is not cheap. Environmental monitoring agencies such as NOAA will need federal funding to continue investing in equipment and staff expertise. And private data providers will need access to cash flow—whether through paying customers or outside investment—to keep updating and improving their products.

What risks do new data sources present, and how will society address them?

For all the potential benefits of more granular climate data, publishing it carries some risks.

One issue is the possibility of false certainty. Even with climate models constantly improving, emerging data sources will still have wide margins of error, particularly around predicting the most uncertain climate events, such as hurricanes. Yet it’s easy to imagine some individuals treating a single data source as gospel, even though there can be significant variation among similar data products and there is limited transparency regarding underlying analytical models. Governments and industry will need to find ways to manage uncertainty with their constituents and customers.

Another concern is how data could impact equity. America’s history of redlining offers a clear example of how mapping perceived risks can lead to disinvestment and discrimination. To the extent that climate risks overlap with racial, economic, and social characteristics, vulnerable communities could face additional barriers, such as higher property insurance rates or a lack of new infrastructure in places of need. Policymakers will need to write regulations that ensure ratings agencies, insurers, government agencies, and others are not discriminating against any people or places.

The price of data could create a barrier to adoption for public agencies, nonprofit organizations, and individuals as well. Datasets that are produced and managed by federal statistical agencies such as the Census Bureau and Bureau of Labor Statistics are made publicly available at no charge to users. But data products created by private firms are typically sold to individual subscribers such as insurance companies and credit rating agencies—often for substantial fees. Financial institutions are able and willing to pay for these services to mitigate fiduciary risk associated with climate change, but most civic organizations have tighter budgets. One example of using the data for public good comes from the nonprofit Climate Central, which has used their own proprietary data to conduct groundbreaking scientific research on flood risk in order to build global citizen awareness of climate vulnerability. The country’s wealthiest cities and counties may be inclined to spend local tax dollars to buy high-quality climate data, which could lead to wiser investments in infrastructure or the ability to counter predatory real estate practices. But it could also further exacerbate capacity differences between those wealthier communities and poorer ones that can’t afford such data.

Addressing these concerns won’t be easy, and will require experimentation. Processes like the Treasury Department’s Climate Data and Analytics Hub pilot are promising efforts. Finding the right balance between transparency and equity will require cities, states, and the real estate industry to test different approaches to implementation. Adaptation strategies that work for second-home owners in Miami may not work for low-income households in Houston’s flood-prone neighborhoods, so placing diverse voices into the policy discussion is essential.

[esgagile]

The Health Advantages of Sustainable Living

Agile Advisors provide Sustainability Report Consultant In Dubai, It's crucial to remember that leading a sustainable lifestyle benefit both the environment and your health. Improved physical and mental health are the only advantages of a more ecologically friendly lifestyle. One way to reduce exposure to potentially dangerous toxins is to choose natural and non-toxic items instead of harsh cleaning solutions and pesticides. This may lessen your chance of contracting cancer, allergies, and respiratory conditions. Air pollution is a severe issue in many places, and exposure to high pollution levels can harm one's health. Adopting eco-friendly practices such as walking or biking instead of driving, taking public transit, and supporting sustainable energy sources can decrease air pollution and enhance local air quality.

In Agile Advisors’ role as Sustainability Reporting Consultant In UAE, this can result in better respiratory health and a lower risk of heart disease. Your mental health may benefit from spending time outdoors and connecting with the natural world. Research indicates that spending time in green areas can enhance general well-being and lessen stress, worry, and sadness symptoms. You can benefit from the advantages of sustainable living for your mental health by including more green areas and natural aspects in your daily life, such as gardening or hiking. Choose natural, sustainable materials when purchasing household goods; avoid those contaminated with dangerous chemicals.

Being a Sustainability Report Consultant In UAE, you can search for products that have certifications from environmental organizations like the Forest Stewardship Council or the USDA Organic. Reducing your energy use is an easy way to lessen your environmental impact! Sustainable habits like using energy-efficient light bulbs, disconnecting electronics when not in use, and turning off lights when leaving a room can be rapidly adopted. The investment community provides the last long-term advantage. The remarkable success of businesses that have taken proactive measures towards sustainability over the past few years, positioning themselves as leaders in the quickly expanding green economy, indicates this shift in investment preferences.

As an expert Sustainability Report Consultant In Dubai, the plethora of advantages listed here makes sustainability appealing to investors. They all imply to potential investors that the sustainability market holds great promise for profitable ventures. The Climate Action 100+ program, run by a consortium of investors and overseeing more than $40 trillion in assets, is the most prominent illustration of this change in investor sentiment. This project, consisting of five international investor networks, aims to hold the world's most prominent corporate greenhouse gas emitters responsible for their part in global warming. The project is pushing businesses to lower their emissions, enhance their governance procedures, and disclose information on climate change more openly to accomplish this.

Agile Advisors are renowned  Sustainability Reporting Consultant In UAE, Businesses that emphasize sustainable practices are better prepared to handle risks associated with compliance, reputation, and disruptions to the market or country. Similarly, implementing alternative energy sources like solar or wind power can protect your company from unanticipated energy price rises. Countries are considering adopting climate transition legislation, and the reach of sustainable disclosure regulations is growing quickly. Companies can take preemptive measures to prevent breaking compliance requirements and avoid a last-minute scramble when the standards are enforced.

#Sustainabilityreportconsultantinuae #Sustainabilityreportingconsultantinuae #Sustainabilityreportconsultantindubai

[raglobal1]

Innovative Approaches to Sustainability Assurance: Trends and Best Practices

Innovation in sustainability assurance has become increasingly important as organizations seek to demonstrate their commitment to environmental, social, and governance (ESG) goals.

Here are some innovative approaches, trends, and best practices in sustainability assurance:

Integrated Reporting: Integrated reporting combines financial and non-financial (including sustainability) information in a single report, providing a comprehensive view of an organization's performance. ESG Report Assurance providers are increasingly offering services to verify the accuracy and completeness of integrated reports, ensuring transparency and accountability.

Technology-Driven Assurance: Technology, including data analytics, artificial intelligence, and blockchain, plays a significant role in Sustainability Report Assurance. These tools enable more efficient and effective data collection, analysis, and verification, enhancing the reliability of sustainability disclosures.

Materiality Assessments: Materiality assessments help organizations identify the sustainability issues that are most relevant to their business and stakeholders. ESG Assurance providers can assist in conducting robust materiality assessments, ensuring that organizations focus on the most significant sustainability impacts.

Stakeholder Engagement: Engaging stakeholders, including investors, customers, employees, and communities, is essential for meaningful ESG Assurance Provider In Dubai. Assurance providers can help organizations develop stakeholder engagement strategies and verify the authenticity of engagement processes and outcomes.

Climate Risk Assurance: With increasing awareness of climate-related risks and opportunities, there is growing demand for assurance on climate-related disclosures, such as those aligned with the Task Force on Climate-related Financial Disclosures (TCFD) recommendations. Sustainability Assurance Provider In Dubai developing methodologies to assess the accuracy and reliability of climate-related information.

Third-Party Verification: Third-party verification provides independent assurance on sustainability claims and performance data. Accredited assurance providers can verify adherence to standards such as ISO 14001 (environmental management) and ISO 26000 (social responsibility), enhancing credibility and trust.

Supply Chain Assurance: Supply chains are a critical aspect of sustainability performance, and assurance providers are increasingly offering services to assess and verify suppliers' sustainability practices. This includes evaluating environmental impacts, labour practices, human rights, and ethical sourcing.

Continuous Assurance: Traditional assurance approaches often involve periodic audits or reviews. However, sustainability assurance is evolving towards constant monitoring and assurance, enabled by real-time data collection and analysis technologies. Continuous assurance provides stakeholders with more up-to-date and actionable insights into sustainability performance.

Regulatory Compliance Assurance: As governments implement stricter sustainability reporting and disclosure regulations, assurance providers play a crucial role in helping organizations ensure compliance. This includes verifying adherence to reporting frameworks such as the Global Reporting Initiative (GRI) standards and Sustainable Accounting Standards Board (SASB) guidelines.

Capacity Building and Training: Assurance providers are offering capacity-building and training programs to help organizations improve their internal sustainability management systems and reporting processes. These programs include educating personnel on sustainability best practices, data collection methodologies, and assurance requirement.

RA Global independent verification of sustainability disclosures and reporting, as part of our ESG Assurance or sustainability assurance services. The terms "ESG Assurance" and "Sustainability Assurance" are often used interchangeably, however  mean the same which is verification of disclosures included in the ESG or sustainability report.

These innovative approaches, trends, and best practices are helping organizations enhance         the credibility, transparency, and effectiveness of their sustainability assurance efforts, ultimately  contributing to more sustainable business practices and outcomes.

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[tarh-and-social-impact]

My Adventure Through the SEC’s Climate Disclosure Labyrinth

I’ve been on quite the adventure lately, diving deep into the world of the SEC’s new climate-related disclosure requirements. It’s been a journey filled with challenges, revelations, and a whole lot of learning. I wanted to share my story with you all, hoping it might shed some light on this complex topic and maybe even inspire a few of you.

The Awakening

It all started with a realization: these SEC mandates aren’t just another set of rules to follow—they’re a call to action for businesses to be transparent about their environmental impact. This was more than compliance; it was about contributing to a larger conversation on sustainability.

The Quest for Knowledge

Understanding the full scope of these requirements was my first challenge. It meant not just reading through the mandates but also grasitating why they matter. This wasn’t just about us as a business; it was about our place in the world and our impact on the environment.

Gathering the Data

Data became my best friend (and sometimes my biggest headache). Collecting accurate, comprehensive environmental data was crucial. It was a painstaking process, but it laid the foundation for everything that followed.

Joining Forces

One of the most rewarding parts of this journey was engaging with others—team members, stakeholders, industry peers. Their insights and perspectives enriched the process, turning it into a collaborative mission rather than a solitary quest.

Empowerment Through Education

I quickly realized the power of knowledge. Educating our team about the importance of these disclosures and how they could contribute was a game-changer. It turned compliance from a top-down directive into a shared goal.

Transforming Risks into Opportunities

Facing our environmental risks head-on was daunting, but it also opened up opportunities for innovation and improvement. It was about turning challenges into chances to do better.

Crafting the Narrative

Writing our disclosures felt like telling our story—a story of challenges, changes, and commitments. It was our chance to share with the world not just what we’re doing but why it matters.

The Seal of Trust

Opting for external verification of our disclosures added a layer of trust and credibility. It was a testament to our commitment to accuracy and transparency.

The Never-Ending Journey

What I’ve learned is that compliance isn’t a destination; it’s a continuous journey. It’s about constantly striving to be better and more transparent.

Beyond Compliance

Ultimately, this journey through the SEC’s climate disclosure requirements has been about more than just meeting mandates. It’s been an opportunity for growth, for leadership in sustainability, and for making a real difference.

For anyone looking to navigate these waters, I found an incredible guide that helped light the way: The Compliance Guide on SEC’s Climate-Related Disclosures: 10 Steps to Mastery. It’s a resource I highly recommend for anyone embarking on this journey.

This adventure has been eye-opening, challenging, and ultimately rewarding. It’s shown me the power of transparency, the importance of environmental accountability, and the impact that one company can have on the broader fight against climate change. Here’s to all of us making a difference, one disclosure at a time.

[tsmom1219]

SEC stays climate-risk disclosure rule as it works through legal challenges

Read the full story at ESG Dive. The Securities and Exchange Commission announced Thursday afternoon it will halt implementation of its climate-risk disclosure rule as it faces several challenges in the U.S. Eighth Circuit of Appeals. The agency is facing nine petitions challenging the rule, including attempts to have the rule paused by multiple parties. After 31 petitioners filed a motion…

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[kp777]

By Oliver Milman

The Guardian

July 5, 2023

Exclusive: new database shows 1,500 US lobbyists working for fossil-fuel firms while representing universities and green groups

More than 1,500 lobbyists in the US are working on behalf of fossil-fuel companies while at the same time representing hundreds of liberal-run cities, universities, technology companies and environmental groups that say they are tackling the climate crisis, the Guardian can reveal.

Lobbyists for oil, gas and coal interests are also employed by a vast sweep of institutions, ranging from the city governments of Los Angeles, Chicago and Philadelphia; tech giants such as Apple and Google; more than 150 universities; some of the country’s leading environmental groups – and even ski resorts seeing their snow melted by global heating.

The breadth of fossil fuel lobbyists’ work for other clients is captured in a new database of their lobbying interests which was published online on Wednesday.

It shows the reach of state-level fossil fuel lobbyists into almost every aspect of American life, spanning local governments, large corporations, cultural institutions such as museums and film festivals, and advocacy groups, grouping together clients with starkly contradictory aims.

For instance, State Farm, the insurance company that announced in May it would halt new homeowner policies in California due to the “catastrophic” risk of wildfires worsened by the climate crisis, employs lobbyists that also advocate for fossil fuel interests to lawmakers in 18 states.

Meanwhile, Baltimore, which is suing big oil firms for their role in causing climate-related damages, has shared a lobbyist with ExxonMobil, one of the named defendants in the case. Syracuse University, a pioneer in the fossil fuel divestment movement, has a lobbyist with 14 separate oil and gas clients.

“It’s incredible that this has gone under the radar for so long, as these lobbyists help the fossil fuel industry wield extraordinary power,” said James Browning, a former Common Cause lobbyist who put together the database for a new venture called F Minus. “Many of these cities and counties face severe costs from climate change and yet elected officials are selling their residents out. It’s extraordinary.

“The worst thing about hiring these lobbyists is that it legitimizes the fossil fuel industry,” Browning added. “They can cloak their radical agenda in respectability when their lobbyists also have clients in the arts, or city government, or with conservation groups. It normalizes something that is very dangerous.”

The searchable database, created by compiling the public disclosure records of lobbyists up to 2022 reveals:

Some of the most progressive-minded cities in the US employ fossil fuel lobbyists. Chicago shares a lobbyist with BP. Philadelphia’s lobbyist also works for the Koch Industries network. Los Angeles has a lobbyist contracted to the gas plant firm Tenaska. Even cities that are suing fossil fuel companies for climate damages, such as Baltimore, have fossil fuel-aligned lobbyists.

Environmental groups that push for action on climate change also, incongruously, use lobbyists employed by the fossil fuel industry. The Environmental Defense Fund shares lobbyists with ExxonMobil, Calpine and Duke Energy, all major gas producers. A lobbyist for the Natural Resources Defense Council Action Fund also works on behalf of the mining company BHP.

Large tech companies have repeatedly touted their climate credentials but many also use fossil fuel-aligned lobbyists. Amazon employs fossil fuel lobbyists in 27 states. Apple shares a lobbyist with the Koch network. Microsoft’s lobbyist also lobbies on behalf of Exxon. Google has a lobbyist who has seven different fossil fuel companies as clients.

More than 150 universities have ties to lobbyists who also push the interests of fossil fuel companies. These include colleges that have vowed to divest from fossil fuels under pressure from students concerned about the climate crisis, such as California State University, the University of Washington, Johns Hopkins University and Syracuse University. Scores of school districts, from Washington state to Florida, have lobbyists who also work for fossil fuel interests.

A constellation of cultural and recreational bodies also use fossil fuel lobbyists, despite in many cases calling for action on the climate crisis. The New Museum in New York City, the Los Angeles County Museum of Art and the Sundance Film Institute in Utah all share lobbyists with fossil fuel interests, as does the Cincinnati Symphony Orchestra and the Florida Aquarium. Even top ski resorts such as Jackson Hole and Vail, which face the prospect of dwindling snow on slopes due to rising temperatures, use fossil fuel lobbyists.

Cities, companies, universities and green groups that use fossil fuel-linked lobbyists said this work didn’t conflict with their own climate goals and in some cases was even beneficial. “It is common for lobbyists to work for a variety of clients,” said a spokesperson for the University of Washington.

A spokesperson for the Los Angeles County Museum of Art said it had retained a lobbyist on the F Minus database “for a period during the pandemic … We are not currently working with the company.”

Read more.

#fossil fuel industry #double agents #climate crisis